U.S. Employment Declines Moderate, But HR Pros Remain Cautious
April 8, 2009
Patricia Marroquin--HispanicBusiness.com
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New figures from the Conference Board indicate that a decline in the demand for labor is slowing. However, another new study finds that 70 percent of human resources professionals and recruiters predict a continuing weak environment for hiring.
The Conference Board's Employment Trends Index (ETI) fell again in March. The index, at 90.1, is a 2.3 percent decrease from February and down 22.1 percent from a year ago.
"While we see a continued sharp fall in the ETI, the decline was not as strong as in the previous four months, suggesting that the most intense stage of job losses may be behind us," Gad Levanon, senior economist at the Conference Board, told media. "However, the drops in each of the eight components of the ETI in March signal that many more jobs will disappear over the next several months."
The ETI takes into account eight labor-market indicators. Those are: job openings (U.S. Bureau of Labor Statistics [BLS]); part-time workers hired for economic reasons (BLS); number of workers hired by the temporary-help industry (BLS); initial claims for unemployment insurance (U.S. Department of Labor); percentage of respondents who say they find "jobs hard to get" (Conference Board Consumer Confidence Survey); percentage of companies with positions they're not able to fill right now (National Federation of Independent Business Research Foundation); industrial production (Federal Reserve Board); and real manufacturing and trade sales (U.S. Bureau of Economic Analysis).
The Labor Market Outlook (LMO) survey, released Tuesday by the Society for Human Resource Management, reported that seven out of 10 human resources professionals polled foresee a weak hiring environment in the second quarter of 2009.
Just 1 percent of those surveyed were very optimistic that there will be job growth in the second quarter.
The LMO survey showed that "companies of all sizes and types are shedding jobs, and HR professionals from all parts of the country have limited optimism that the situation will improve," the study stated.
"I don't think that there's any sector that's totally escaped the issues," Jennifer Schramm, manager of workplace trends and forecasting at the Society for Human Resource Management, told HispanicBusiness.com.
The study found that publicly owned for-profit companies eliminated jobs at the highest rate in the first quarter (51 percent), followed by privately owned for-profit companies (44 percent of which instituted layoffs), government (26 percent) and nonprofits (25 percent).
"A lot of economists are not anticipating that (the labor market) will get better this year," Schramm said.
The LMO study noted that economists and labor market experts have varying opinions on when the labor market will begin its recovery. "Most are not calling for a rebound until 2010 at the earliest," the study said, "and that will depend, in part, on the effectiveness of the stimulus package approved by Congress in February."
Almost 85 percent of the HR professionals surveyed said they cut jobs (39 percent) or kept payrolls flat (45 percent) in the first quarter of 2009. That represented a drop in hiring activity from the fourth quarter of 2008, when a combined 76 percent of those surveyed either cut jobs or kept payrolls flat.
For the second quarter of 2009, nearly 70 percent of survey respondents said they will either eliminate jobs (17 percent) or keep their payrolls flat (52 percent).
The findings of the Society for Human Resource Management come from a survey of nearly 500 public- and private-sector human resource professionals who have a direct role in staffing decisions at their U.S. companies, which are of all sizes and comprise for-profit, nonprofit and government entities.
The degree of pessimism over job growth in the second quarter did not differ much from region to region. Respondents in the Midwest, however, were the most pessimistic, expecting deeper job cuts (74 percent).
"Looking ahead, HR professionals are not showing much faith in a rebound for the U.S. labor market," the study said. "Only 1 percent of respondents said they were very optimistic that there will be job growth during the second quarter of 2009."
Schramm noted that generally HR professionals base staffing forecasts on a demand for product. But with the credit market crunch in October, "that has had a lot of impact on how both staffing and HR professionals are able to forecast what they are able to do," she said.
"I think that the nature of this current economic crisis is making it a little more difficult (for companies) to predict what their staffing needs are going to be," she added.
"Among all our surveys," Schramm said, "we rarely have such a large percentage (of HR professionals) who say they don't know. It's saying something significant that there is such a large percentage taking a wait-and-see attitude. It's hard for them to plan right now."
Source: HispanicBusiness.com (c) 2009. All rights reserved.
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