Recruiting and Hiring in 2010: Definitive Signs of Positive Changes

In an economic recovery both slow and fitful, for many companies 2010 has been a long drive in first gear. When it comes to corporate perspectives on the employment picture, optimism comes measured and qualified.

“There’s a lot of negative news out there about the labor market, but it’s good compared to last year,” says Jesse Harriott, senior vice president and chief knowledge officer at Monster. In fact, the Monster Employment Index, which measures online recruitment activity across the United States, showed year-over-year improvement in eight consecutive months in 2010.

The magnitude of improvement in hiring trends is modest. “Employers are being very cautious to hire on a permanent basis,” says Michael Steinmetz, vice president and general manager of the Midwest division of Manpower. And employer confidence has grown inconsistently this year. “There’s a higher level of temporary hiring in September than there was even this spring,” indicating that hiring companies are hedging their bets.

Still, come recovery or recession, employers are always hiring, if only to counter some attrition in staffing activity. “The labor market is a machine; even in the worst months millions of people are getting jobs,” says Harriott. Total US job openings increased to 3.2 million in August 2010 from 2.4 million a year earlier, according to the government’s Job Openings and Labor Turnover Survey.

Some Industries Move Ahead Faster
Notwithstanding seasonal variations in employment and the complex labor fluctuations of the Gulf oil spill, some industries have shown more solid improvement, including larger than usual year-end hiring opportunities in finance and tax preparation.

“We’ve also seen growth in manufacturing and IT,” says Steinmetz. As bloated inventories have declined to healthier levels, factory activity has picked up. Many information-technology projects delayed during the recession have resumed.

Elsewhere in the economy, the Monster Employment Index continues its annual gains in online postings over the 12 months ending September 2010 in health care and social assistance (to 110 from 88) and transportation and warehousing (to 154 from 128); both recorded annual increases of 25 percent and 20 percent respectively. These are positive signs for both industries as their annual growth rate exceeds that of the overall index.

The Skills Gap has only Closed a Bit
Some employers expected that the skills gap would narrow, as a sort of recession dividend; they may be disappointed. “Employers have more options, greater opportunities to hire good talent,” says Steinmetz. “But there’s still a rather large proportion of employers that are having trouble finding the right talent — it’s just that the extent of the difficulty is not as great as it was a few years ago.”

Despite the evolution of today’s workforce composition, even job seekers who possess hard-to-get skills may lack the commitment that employers are looking for. “For factory jobs like welding and electronics, the challenge is finding folks who demonstrate they’re committed with their whole heart, that it’s a career for them,” says Randy Berg, vice president of human relations for Watchfire Signs, which designs and manufactures digital outdoor signs. Watchfire has grown its workforce by 10 percent in 2010.

Relocation for a Very Few
Relocation, in recent decades a key tactic in talent wars, has been deployed more sparingly in 2010 as part of an employee benefits strategy.

“Companies are having a much harder time getting people to move; they don’t want to pay for housing to relocate employees,” says Harriott. “These days employers often restrict searches to the local area, though sometimes they need to do a national search.”

Companies like Watchfire, located in Danville, Ill., population 34,000, may have no choice but to lure talent with moving money. “We do offer a relocation benefit, sometimes for software engineers,” says Berg. “It’s a simple package of some cash and specific reimbursement for a relocation provider, and sometimes housing for a month or two.”

Pay Increases Are Back, in Moderation
Compensation packages have also stabilized in 2010. “Last year employers were asking for pay reductions; we’re seeing a lot less of that in 2010,” says Steinmetz. Real earnings, which reached a recent low in October 2009, have since increased 2 percent, according an August 2010 report from the Bureau of Labor Statistics.

Most employers feel they’re now in a position to offer measured increases in salary and benefits. “We offer regular pay increases, but not huge raises on hire or when they change jobs here,” says Berg. “I don’t think we’ve lost anyone because we couldn’t come to a reasonable agreement on pay.”

What will 2011 bring? A more reliable road to sustained expansion, we all hope. “All in all, we’re in a much more stable environment, which creates a good platform for future job growth — once some of the uncertainty around the economy lifts,” says Steinmetz.

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