Employment Growth Surveys Reflect Contradictions in Job Trends : Published November 2006 All Rights Reserved


Employment Growth Surveys Reflect Contradictions in Job Trends

Depending upon which survey is used to gauge employment trends results differ and even contradict each other during the month of October 2006. Military related job growth seems to hold the greatest opportunities while professional job growth is not clear. Employees however appeared to feel positive about prospects in general.

Employee confidence in the United States rose less than one point to 59.2 in October according to the Spherion Employment Report. The October increase represented the fourth increase in six months and the highest level since December 2005.

The Spherion® Employee Confidence Index, a monthly gauge of overall worker confidence, increased 0.7 points in October, following a 2.8 point increase in September. The Index is 5.1 points higher than the level recorded in October 2005. The study represents employee confidence on the strength of the economy and the availability of new jobs.

Harris Interactive surveyed 3,112 working adults for the Spherion study. Sixty-three percent of workers believed the economy was either stable or strengthening, compared with 59 percent in September. Some 27 percent believed more jobs were available, which is up 2 points from September.

Fewer workers were confident in their ability to find a job (59 percent in October compared to 61 percent in September) and in the future of their employer (64 percent in October versus 65 percent in September.) These small drops did not impact workers’ optimism about their job security, Spherion concluded, which rose 1 percent to 80 percent, the highest level ever recorded.

Employees' intentions to change jobs held steady, with 36 percent saying they planned to change jobs at some point before October 2007.

"Our latest report shows that workers have been largely unfazed by the weaker than expected economic expansion over the past few months," said Roy Krause, president and chief executive officer of Spherion. "I believe the jump in macroeconomic confidence is again largely due to falling energy prices and continued job growth, but with a lot of economic uncertainty and a contentious election ahead of us, I was somewhat surprised the gain was as significant as it was."

Krause added that the employment environment remains favorable, but the market as a whole is showing signs of only moderate growth. "We see steady demand from our clients for both temporary and direct hire positions in a wide variety of industries, which certainly is good news for the 36 percent of workers who plan on making a job change soon."

Employment Activity in Non-manufacturing Slows

Business activity in the non-manufacturing sector increased at a faster rate in October 2006, according to the United States' purchasing and supply executives in the latest Non-Manufacturing ISM Report On Business®. (ISM is the Institute for Supply Management)

The Non-Manufacturing ISM Report compiles data from purchasing and supply executives nationwide. Membership of the Non-Manufacturing Business Survey Committee is diversified by NAICS, based on each industry’s contribution to gross domestic product (GDP.)

Anthony Nieves, chair of the ISM, said, "Non-manufacturing business activity increased for the 43rd consecutive month in October.

"Business activity increased at a faster rate in October than in September. Inventories, new export orders, imports and inventory sentiment also increased at a faster rate.

"Nine of 18 non-manufacturing industry sectors reported increased activity in October. Members’ comments in October continue to be mixed concerning current business conditions; however, the majority of the comments are positive. The Prices Index decreased 4.8 percentage points this month to 51.9 percent. The overall indication in October is continued economic growth in the non-manufacturing sector at a faster pace than in September."

Despite the good news employment activity in the non-manufacturing sector increased at a slower rate in October compared with September. Industries reporting reductions in the workforce did include higher-skilled jobs in the United States. ISM’s Non-Manufacturing Employment Index for October was 51 percent, a decrease of 2.6 percentage points from the 53.6 percent reported in September.

Eight industries reported increased employment, eight reported a decrease, and two indicated employment is unchanged from September. Comments from respondents include: "Hiring freeze and some layoffs" and "recent downsizing of 5 percent of the workforce."

Conflicting Results on Professional Job Growth

The industries that reported growth in employment included agriculture, forestry, fishing and hunting; transportation and warehousing; management and support; public administration; health care and social assistance; information; wholesale trade; and educational services.

The eight industries reporting a reduction in employment in October were mining; arts, entertainment and recreation; real estate, rental and leasing; accommodation and food services; professional, scientific and technical services; construction; retail; and finance and insurance.

In contrast with ISM's results, online job seeking tool monster.com reported that for October its online job ads found no change in hiring activity. According to monster.com online demand for jobs grew for professional, scientific, and technical services sector. Worker demand for mining and utility industries reflected continued natural resources expansion and focus on alternative energy sources growth.

Military recruiting grew and aerospace jobs soared according to monster.com as the United States continues to invest more in military spending in the long-term to fight wars in Iraq and Afghanistan.

"Professional and technical services such as IT, design, software, advertising and marketing also exhibited strong online job availability, with computer and mathematical occupations showing 33 percent year-over-year growth and suggesting continued high demand for qualified technology workers," monster.com reported.

Nonetheless, the Monster Index recorded its lowest annual growth rate (20.3 percent) since its inception in October 2003, reflecting an overall slowdown in economic and payroll growth during the third quarter. Monster.com does not verify each job posting so it is not possible to estimate how many of the jobs posted on monster.com were actually marketing scams. However the advertising and marketing category notoriously accounts for the greatest number of scam-type job postings.

"While the October findings of the Monster Employment Index are consistent with other economic indicators that show a slowing down from the rapid pace of economic growth during the first half of 2006, the fact that unemployment rates across the country are at five-year lows suggests little slack in the overall labor market," said Steve Pogorzelski, Monster Worldwide president.

"In fact, there are numerous industries where robust expansion and existing labor shortages continue to spur demand for workers, particularly in areas such as advertising/marketing, IT/engineering, healthcare, defense/security and utilities." 

Monster reported the following results:

During October, eight of the 20 industry categories tracked by the Index showed greater online demand for workers, led by utilities, which surged 14 points and registered the strongest month-to-month increase. Mining also edged up for the third consecutive month, rising four points. The growth of opportunities in these sectors reflects the increased investment in oil and gas technology, as well as renewed focus on sustainable energy sources, which have driven up demand for skilled workers. Online job availability in the professional, scientific and technical services sector also rose, adding three points and extending a three-month growth trend.

In contrast, online recruitment activity in the wholesale trade sector plunged 13 points, registering the sharpest decline among industries, while demand in transportation and warehousing fell 10 points, following a sharp rise the previous month. At the same time, online demand in the retail trade industry edged one point higher, extending a three-month upward trend in a likely build-up ahead of the end-of-the-year shopping season. Meanwhile, online opportunities in real estate, rental and leasing edged down one point last month and have declined over the year as the cooling housing market appears to have gradually reduced overall staffing needs in the sector.

Twelve of the 23 occupational categories tracked by the Index showed a rise in online job availability in October, with military specific occupations jumping 21 points and registering the strongest monthly rate of increase. Last month’s rise was mostly due to heightened demand in the armed services and the aerospace industry, which has recently benefited from a significant surge in bookings for commercial aircraft. Online job availability for computer and mathematical occupations jumped seven points, extending a three-month growth trend amid continued strong demand for IT professionals across the country. Meanwhile, the Index for arts, design, entertainment, sports and media occupations rose six points, and community and social services surged 13 points, continuing a three-month upward trend. Sales related opportunities also edged up, suggesting that retailers may have begun seeking temporary workers to assist with the approaching holiday shopping season.

Among the Index categories showing lower online job demand in October, building, grounds cleaning and maintenance, and legal registered the sharpest decline, as both shed 10 points. The education, training and library category also declined, falling seven points and easing back from heightened demand leading up to the start of the school year.

Online recruitment activity increased in the West South Central region (up four points,) which continued to show the strongest year-over-year growth rate due in part to ongoing reconstruction efforts in Louisiana.

The East South Central region registered the sharpest decline, falling nine points amid reduced online job availability in Alabama and Mississippi. Alabama’s manufacturing industries have reportedly been suffering a downturn, while Mississippi continues to struggle with the nation’s highest unemployment rate and a coastal economy that has yet to recover from the devastation caused by hurricane Katrina in 2005. Overall, 24 states saw online job availability climb by varying degrees in October.

Spherion's specific findings from its macroeconomic confidence index found that 27 percent of adult workers believed more jobs were available and 24 percent of adult workers believed the economy is getting stronger.

The survey's personal confidence index decreased however to 74.2 in October, a 1.2-point drop from September, as fewer workers were confident in their ability to find a new job. The Index was two points higher than the level recorded in October 2005.

Specific findings from the Personal Confidence Index reported that 64 percent of adult workers felt confident in the future of their employer and 59 percent of adult workers have confidence in their own ability to find a new job, down 2 percent from September.

Some 80 percent of the workforce surveyed told Spherion that it was unlikely a job loss would affect them during the upcoming 12 months, or a 3 percent increase in confidence from October 2005.

Results of the Spherion study were based upon data from the Harris Interactive QuickQuery online sample of 3,112 employed adults.


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