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U.S. Hiring Shows Slight Decline in Third Quarter
Companies continue to see the effects of rocketing oil prices, poor economic growth and slow consumer spending as job creation continues to gradually decrease, according to the latest quarterly job forecast from CareerBuilder.com and USA TODAY.
Nearly one-in-four employers plan to add full-time, permanent employees to their staff in the third quarter of this year, down from 26 percent of employers who increased their staff last quarter, according to the survey. Sixty percent of hiring managers had no change in their staff levels during the second quarter and 13 percent of businesses reduced their work force.
Though the job market is slower than in previous years, the hiring environment for the upcoming quarter is keeping with the status quo: cautious, but still competitive in select, in-demand industries. Thirty-four percent of employers said they have slowed their hiring pace this year compared to 2007 because of reservations about the economy. Nine percent of companies plan to cut back on staff in the third quarter, 62 percent expect no change and 5 percent are undecided.
Here are some of the highlights from the latest job forecast:
Employers have mixed reactions on economic turnaround. Nineteen percent of employers anticipate an improved economy in the second half of 2008, which will help kick off new business initiatives and staff expansions. Thirty-two percent of employers, however, don't expect economic improvement until the first half of 2009 and 16 percent said the economy isn't likely to turn around until the second half of 2009.
Specific industries keep hiring competitive. Information technology has the greatest demand for new workers, with 37 percent of IT employers planning to add full-time, permanent employees in the upcoming quarter. Thirty-one percent of hiring managers in professional and business services, plus 30 percent of large health-care employers (50 or more employees) plans to add more staff in the third quarter.
Sales, hospitality and transportation/utilities are all planning to increase headcount at 27 percent and 26 percent respectively. Financial services and retail will also boost staffing numbers at 20 percent and 18 percent, respectively.
Workers are fearful of layoffs -- but open to greener pastures. Though 85 percent of hiring managers reported having no layoffs in the second quarter, 24 percent of workers are still fearful of being laid off during this uncertain time.
Thirteen percent of employers reported there were layoffs at their locations in the second quarter. Ten percent of hiring managers foresee layoffs at their firms in the third quarter; and 81 percent expect no change.
Nineteen percent of workers are actively looking for new jobs with employers who can offer better pay, career advancement opportunities and more stability. Among those workers not actively looking for a new job, 83 percent said they wouldn't be opposed to accepting a different position if the right opportunity arose.
Job changing becoming a trend. Of the portion of workers looking for new jobs, retail workers were found to be the most likely to change jobs at 24 percent, followed by sales at 22 percent, hospitality at 21 percent and IT at 20 percent.
Other industries that are seeing workers looking for new jobs include 19 percent of professional and business services employees, 17 percent of those in financial services, 16 percent in health care and 15 percent in transportation/utilities.
Other findings surrounding job change include 36 percent of workers reported they change jobs every three to five years. Fifty-five percent of workers reported having worked for at least five employers and 11 percent have worked for 10 or more employers. Finally, 28 percent of workers say it took them two months or longer to find their last job and 11 percent said it took more than six months.
Talent crunch still exists, despite massive layoffs. For the past several months, hiring managers have experienced difficulty finding adequate talent for open positions. This struggle continues, despite continual job losses around the United States. From January through May, the U.S. suffered an average of 65,000 job losses per month, according to the Bureau of Labor Statistics.
Thirty-five percent of employers reported they currently have open positions for which they can't find qualified candidates, according to the survey. Twenty-nine percent disclosed that they are keeping workers around that they would normally let go, for fear of not finding satisfactory replacements.
On the other hand, several employers are improving the existing talent pools within their organizations. During this slow hiring period, 26 percent of employers are replacing their lower-performing employees with newer, better talent.
Job seekers to receive generous offers to recruit top talent. With the aforementioned talent crunch, employers are doing whatever they can to recruit the best talent from the job seeker pool. High-demand industries like health care, IT and engineering are likely to offer generous starting salaries in the upcoming months.
Additionally, 64 percent of hiring mangers plan to increase salaries for full-time, permanent employees. Thirty-seven percent projects the average raise will range between 1 and 3 percent, while 25 percent of employers anticipate an average raise of 4 to 10 percent. Just 2 percent expect salaries to increase by 11 percent or more. Twenty-nine percent don't plan to change compensation levels and 2 percent are planning to decrease salaries.
Hiring outlook strongest in South and West regions. During the next three months, 28 percent of employers in the South and 27 percent in the West plan to add full-time, permanent employees to their staff, compared to 22 percent in the Northeast and 20 percent in the Midwest regions.
Conversely, employers in the Northeast and Midwest plan to reduce staff at 11 and 9 percent, respectively. Just 8 percent of employers in the South and 7 percent of employers in the West plan to trim down headcounts.
Large companies more likely to hire in third quarter. Twenty-seven percent of employers with more than 250 employees plan to hire more full-time, permanent positions in the next three months, with 28 percent of those companies with 51-250 employees doing the same. Just 18 percent of those with 1 to 50 employees will be adding staff this quarter.
Matt Ferguson is the CEO of CareerBuilder.com, the nation's largest online job site with more than 23 million unique visitors and over 1.6 million jobs. He leads the daily operations and growth of the company, overseeing sales, finance, marketing, information technology, product development, integrated media, business development, customer care and human resources.
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