As we previously reported, various research is predicting a hiring decline for the second quarter of 2019, while a totally separate set of data is showing an increase. Yesterday, we looked at ADP data, which showed an increase in hiring. We also looked at data from Paychex and The Conference board, which both reported a decline in hiring. So which is it?
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In order to get to the bottom of the latest hiring trends, we turn to the Bureau of Labor Statistics’ (BLS) latest Employment Situation Summary.
BLS Employment Situation Summary
Last week, the BLS released its monthly Employment Situation Summary for March. And like ADP, the BLS is also reporting a hiring increase.
Total employment increased by 196,000 in March, and the unemployment rate was unchanged at 3.8%, according to BLS. Notable job gains occurred in health care and in professional and technical services.
The new data “confirms that high-growth industries are adding new talent to support their push toward digitizing their operations across sectors. This process is likely to stave off productivity losses by the shortage of skilled talent in our low-employment labor market,” says Rebecca Henderson, CEO and Executive Board Member of Randstad Sourceright—in an e-mail to Recruiting Daily Advisor.
“As these companies compete more aggressively with the technology sector for talented workers, restrictions on visas for skilled immigrants is likely to squeeze the talent pool even tighter. Maintaining growth in a tightening job market will require the most dynamic companies to invest in their workforce through upskilling and reskilling programs.”
Break out that scorecard; it’s time to tally up the data! As previously noted, Paychex and The Conference Board both reported hiring declines, while ADP and the BLS are reporting hiring increases. I hate a tie, so we’re turning to Korn Ferry to settle it for us!
Korn Ferry Breaks the Tie
Last week, Korn Ferry also noticed the confusing trends in hiring data based on reports from January and February. In a blog post, the company reports that their very own recruiting expert say that a majority of employers are still adding jobs. Similar to what BLS reported, Korn Ferry is seeing hiring in the same industries.
“The main areas where jobs have been growing are healthcare, supply chain logistics, and information technology,” says Bill Sebra, global operating executive for Korn Ferry’s professional search and recruitment process outsourcing (RPO) businesses. “The number of healthcare jobs grew by nearly 21,000 in February, according to the US Labor Department, and overall, the nation has more than 16.7 million people working in healthcare jobs, an increase of 393,000 over the last year.”
And just like the BLS, Korn Ferry reports that “the biggest job-creating family is information technology [IT]. IT added 253,000 positions, the biggest one-month gain by this segment in more than three years.”
“Those IT jobs will still be needed,” says Sebra. “But adding them may come at the expense of other divisions. The current models of these highly industrialized organizations won’t survive in the new digital world. They have to do the work.”
As Korn Ferry points out, hiring is still happening, it’s just impacting different industries in different ways. And while the other data showing a hiring decrease may not necessarily be wrong, it definitely helps paint a broader picture of the entire hiring landscape.
The bottom line is: we’re still in a candidate-driven market, so your recruiting strategies for such should still be in play. And if you can’t find that purple squirrel, you can always look for that one candidate who is willing and able to learn more. As Irina Novoselsky, CEO of CareerBuilder, suggests upskilling jobseekers and highlighting your work perks to stand out.
“Despite low unemployment, holding steady at 3.8%, we’re seeing millions of candidates coming to our site and using CareerBuilder’s mobile app as they look for new jobs this year,” says Novoselsky—in an e-mail to Recruiting Daily Advisor. “With 59% of employers willing to hire candidates who may not be fully qualified with plans to train them on the job, job seekers are maintaining a powerful position in the market and can be more selective with the roles they are accepting and applying to, not only based on compensation, but also taking into account other perks like commute time and corporate culture.”
With all this talk about hiring, it only makes sense that we’d report on the latest job cuts report from outplacement firm Challenger, Gray & Christmas.
Challenger, Gray & Christmas, Inc. Job Cut Announcement Report
Late last week, Challenger released its latest Job Cut Announcements Report, which focuses on job cuts across various industries throughout the U.S.
Challenger reports that employers were planning to cut 60,587 jobs from their payrolls in March, which is down 21% from the 76,835 cuts announced in February. Despite the decline, last month’s cuts in the Automotive and Energy sectors added to the highest quarterly total of the last 14 quarters. It is also the highest first-quarter total since 2009, when 562,510 cuts were recorded.
As Paychex and ADP data show a decline in construction hiring, the industry is making minuscule cuts to its workforce, compared to other industries. Challenger is reporting that the March job cuts were led by the automotive industry, which announced 8,838 cuts. So far this year, automotive manufacturers and suppliers have cut 15,887 jobs.
Energy companies followed with 8,149 planned cuts last month, for a total of 10,548 this year. By way of comparison, the construction industry is only planning on cutting 184 jobs. While this information may show a decline in employment for certain industries, it’s also opening up room for new positions in industries that are shifting to more technology-based roles.
“Both Auto and Energy companies are pivoting in response to advances in technology and consumer demand for more efficiency,” says Andrew Challenger, Vice President of Challenger, Gray & Christmas, Inc.—in a press release. “Companies in these sectors are attempting to attract talent who can compete with tech companies, like Apple and Tesla, which are beginning to compete in this space.”
“At the same time, the big automakers are adding positions. In order to move talent through the pipeline, we’ve seen a number of companies offer buyouts or voluntary severance packages to thousands of their workers. Many of them are offered to workers who are 55 and older and who have been with the company for a number of years. It’s clear that companies are attempting to make way for new talent. While necessary, companies should consider retaining their seasoned talent for their experience and institutional knowledge as they make this transition,” he adds.
Furthermore, retailers continue to lead all sectors in job cuts this year with 46,061—4,860 of which were announced in March. That is 18.5% lower than the 56,526 Retail cuts announced in the first quarter of 2018. According to Challenger tracking, retailers have announced plans to shutter 4,048 stores so far this year.
“While Retail is by far responsible for the highest number of cuts recently, the sector is also constantly hiring. In fact, The Home Depot announced it would hire 80,000 workers for the spring and summer months,” said Challenger.
So, what’s causing these cuts? The majority (49,868) of cuts this year are due to “restructuring;” while bankruptcy claimed another 40,218, a 33.8% increase over the first quarter of last year. Another 27,380 cuts were due to plant, unit, or store closings, 104.7% higher than the 13,374 cuts due to closings through this point last year.
So, to briefly recap all this info: it’s still a candidate driven market, no matter which hiring report you look at it. Don’t be discouraged if you’re having difficulty hiring at this time. As they say, “What goes up, must come down” … right?