It’s easy to forget that job growth is a lagging economic indicator. This is what lends to the frustration so many of us have when we keep hearing that consumers are spending more, that corporations are raking in record-level profits and that there’s little fear that the economy will slide back into a recession.
We want a good jobs report, and we want it now. But the fact is, the U.S. labor market will be the last segment of the economy to make a full recovery, because:
But here’s the good news: As 2011 drew to a close, federal officials quietly revised their estimates for job growth. Remember that August 2011 report that showed a net gain of zero jobs? After collecting more data, the U.S. Department of Labor (DOL) determined that 104,000 jobs were actually created during that month. The DOL revised September 2011 and October 2011, too. And in December 2011, an estimated 200,000 jobs were created.
Job creation figures for September 2011, initially reported to be 158,000, was revised to 210,000; the 80,000 total jobs reportedly created in October 2011 was revised by DOL to 100,000. Those numbers are still not considered sufficient to make a dent in the unemployment rate, but there were also 3.3 million job openings in the United States in October 2011—an increase of 35 percent since the recession ended in June 2009.
There are plenty of companies that are hiring right now, and many of them aren’t sitting around waiting for Mr. (or Ms.) Perfect to walk through the door. They’re looking overseas and in the ranks of the military to fill those slots, according to new research
by the Society for Human Resource Management (SHRM).
The SHRM survey The Ongoing Impact of the Recession—Global Competition and Hiring Strategies shows that 52 percent of organizations that are hiring full-time staff are having difficulty landing qualified candidates. Of that group, 24 percent have hired foreign workers to take those hard-to-fill jobs, and 39 percent have hired veterans of the U.S. armed forces for those positions.
So what can be expected during 2012? Some predictions:
Employment services firm Manpower Group said a net of 9 percent of employers will add jobs in the first quarter of 2012, according to its quarterly employment outlook survey. Seventy percent expect “no change” in their hiring plans. “[Employers] continue to struggle to find talent with mission-critical skills,” said Jonas Prising, the company’s president of the Americas.
Wells Fargo’s economics group is calling for slow and steady job growth throughout 2012. The banking giant expects 1.5 million jobs to be created in 2012—an average of about 123,000 jobs per month. The pace of job growth, though, “will be disappointing as structural challenges in the labor market persist,” according to the bank’s 2012 economic outlook. The report adds that the “disconnect between the skills among the American labor force and the skills in demand by firms remains the biggest challenge to stability” in the labor market.
Staffing company Robert Half International reported that a net of 10 percent of employers will hire professional-level staff in the first quarter of 2012; its survey includes respondents from the accounting/finance, human resources, advertising/marketing, information technology and legal industries. At the same time, 67 percent of executives responding to this survey said it is at least “somewhat challenging” to find skilled employees, up from 59 percent in the fourth quarter of 2011 and 42 percent in the third quarter of 2011.
Sensing a pattern here?
The Federal Reserve Board of Governors reported that the unemployment rate is projected “to decline only gradually” by 2014, according to notes from its November 2011 meeting. Members of the board projected a range in unemployment from 8.1 percent to 8.9 percent for 2012.
Finally, the National Association for Business Economics (NABE) is forecasting incremental job growth in 2012. According to its economic outlook from November 2011, monthly job gains are expected to “rise steadily from an average of 100,000 during the fourth quarter of 2011” to 130,000 by the end of 2012. NABE economists identified “excessive unemployment” as their single greatest concern for the economy.