For recruiters and hiring managers who like to stay up-to-date on the latest hiring trends, conflicting reports are leaving everyone scratching their heads. Is hiring up, down, or in-between? We’re getting to the bottom of it once and for all!
Paychex | IHS Markit Small Business Employment Watch
For those of you who follow Paychex data, the business solutions provider is reporting that hiring declined in the month of March. Early last week, Paychex released its recurring Paychex | IHS Markit Small Business Employment Watch, which shows March saw the first job growth decrease of 2019, but as the name of the report implies, this decline is occurring for small business employers.
“After remaining relatively flat in January and February, the Small Business Jobs Index declined 0.15 percent to 98.78. However, despite a 0.88 percent slowdown year-over-year, the first calendar quarter of 2019 represents the strongest quarter in the past year,” reports Paychex | IHS Markit.
Additionally, while hiring has declined, wages continue to grow slightly. “Hourly earnings growth moderated slightly to 2.52 percent ($0.66) in March, while annualized one-month and three-month growth rates were closer to three percent,” says the report.
“The challenges of hiring in the tight labor market continued in March as small business job growth declined,” says Martin Mucci, Paychex President and CEO—in a press release announcing the data. “As our latest Business Sentiment Report indicates, business owners’ optimism about their ability to fill open positions with qualified candidates remains low.”
Broken down further by geography and industry, the March report also shows:
- The South continues to lead regions in employment growth; the West remains the top region for hourly earnings growth by nearly a full percent.
- Texas remained the strongest state for small business job growth; California is once again the top state for wage growth.
- Dallas took the top spot among metros in job growth; San Diego took the lead among metros for wage growth.
- Though it remains one of the strongest sectors for small business employment growth, construction fell below 100 on the index for just the second time in over 7 years.
While Paychex | IHS Markit reports a hiring decline for March, ADP reports that there is hiring growth.
ADP National Employment Report
The ADP National Employment Report® is reporting that private sector employment has increased by 129,000 jobs from February to March. One caveat to the ADP research is that it compiles data from employers of ALL sizes, not just small business. The ADP report—which is derived from ADP’s actual payroll data—measures the change in total nonfarm, private employment each month on a seasonally adjusted basis.
So, when it comes to small business hiring, ADP reports that there has been a slight increase, compared to Paychex | IHS Markit’s findings. While ADP’s findings conflict with Paychex data, one thing both have in common is the hiring expectations in the construction industry. ADP lumps construction into its “goods-producing” sector, which also includes industries like manufacturing and mining. ADP finds that the construction industry is also showing a decline in hiring.
“March posted the slowest employment increase in 18 months,” says Ahu Yildirmaz, Vice President and Cohead of the ADP Research Institute—in a press release announcing the data. “Although some service sectors showed continued strength, we saw weakness in the goods producing sector.”
So, if you’re keeping track at home, there’s one check for “decline” and one for “increase” … onto the next data!
The Conference Board Help Wanted OnLine Index
The Conference Board—a member-driven think tank that offers workplace insights—also released its latest data on hiring and, just like Paychex, its reporting a decrease for March. However, just like ADP, there’s one minor caveat: The Conference Board focuses on ONLINE hiring, which differs from what ADP and Paychex focus on.
The Conference Board’s Experimental Help Wanted OnLine® (HWOL) Index measures changes over time in advertised online job vacancies, reflecting monthly trends in employment opportunities across the United States. The HWOL Data Series aggregates the total number of ads available by month from the HWOL universe of online job ads.
Ads in the HWOL universe are collected in real-time from over 28,000 different online job boards including traditional job boards, corporate boards, social media sites, and smaller job sites that serve niche markets and smaller geographic areas.
“The HWOL index declined in March but remains at a level consistent with solid hiring activity,” says Gad Levanon, Chief Economist, North America, at The Conference Board—in a press release announcing the data. “Despite the one-month decline, it is too early to conclude that hiring activity is slowing. We still expect economic growth to remain above the two percent rate throughout 2019. While job growth is likely to slow, we expect it will remain strong enough to tighten the labor market and draw more people into the labor force.”
So, two sets of data show “decline” and only one that shows “increase,” but wait, there’s more! For the ultimate end-all, be-all deciding factor of hiring gains/declines, we turn to the Bureau of Labor Statistics’ latest Employment Situation Summary, which we will cover in part two of this article.