The pace of announced workforce reductions is about 40 percent ahead of last year. However, a surprising new report shows that, through September, employers have already announced plans to hire more workers than they did in all of 2008.
The report released October 12 by global outplacement consultancy Challenger, Gray & Christmas Inc. indicates that some employers see the light at the end of the tunnel and feel confident enough about the prospects of the recovery to begin adding workers, albeit slowly.
Through September, employers have announced plans to hire 169,385 workers this year, according to Challenger’s tracking. That is 88 percent more than the 89,924 planned hires announced in the first three quarters of 2008. The 2009 nine-month total has, in fact, already surpassed the 2008 year-end total of 118,600.
Surprisingly, most of the hiring plans announced this year have come from employers in the retail sector, which has struggled amid falling consumer spending. These employers announced plans to hire 33,640 workers, compared to less than 4,000 in all of 2008.
The biggest hiring sector behind retail is the government and non-profit sector, which has plans to add 28,469 workers. It is followed by the entertainment and leisure industry, which is adding 22,370 new workers.
“Of course, these figures represent just a tiny fraction of the hiring and available jobs out there. We track hiring announcements, but the vast majority of employers do make formal hiring announcements unless they are building a plant, opening a new facility or store, or announcing expansion plans that might affect their stock value,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.
“Even newspaper and online help wanted ads do not tell the whole story when it comes to hiring and job availability. In fact, help wanted ads probably represent less than half of the actual job openings and possibly as little as 20 percent. Within the hidden job market are companies that plan to fill positions through employee referrals, those that use recruiters to find the right candidates, as well as those that have no plans to hire, but will do so if the right person comes along,” said Challenger.
The latest Job Openings and Labor Turnover survey from the Bureau of Labor Statistics found that there were approximately 2.4 million job openings as of August. That was down from 3.9 million job openings a year ago. In addition to the August job openings, the BLS survey showed that employers hired about 4.0 million workers during the month.
“It can be discouraging when all you hear about are the economy shedding an average of 300,000 jobs per month and unemployment rising to 9.8 percent. But the fact is the labor market is extremely fluid, even in the worst of times. Companies are constantly adding and subtracting workers, sometimes simultaneously,” said Challenger.
As an example, Challenger pointed to the retail industry, which is among the top hiring industries, with nearly 34,000 planned worker additions. However, it is also among the top job-cutters of the year, having announced more than 95,000 job cuts through September.
In a case of simultaneous hiring and firing within a single company, Microsoft reported plans to hire an estimated 2,000 to 3,000 workers to “support its business strategy in key areas.” The plans were revealed just weeks after the software giant announced that it would trim 5,000 employees from it payrolls over an 18-month period.
“There is no doubt that this is a tight job market. There simply are more job seekers than there are jobs. However, it would be a mistake to assume that no one is hiring. Companies need to replace retirees and others who leave voluntarily. Everyday people are fired for cause and need to be replaced. Employers are continually reevaluating their workforce needs, so it is critical to persevere,” said Challenger.
“Part of being successful in this job market, is being in the right place at the right time. Some of it is luck, but job seekers can definitely improve their chances of being in the right place at the right time by looking beyond the newspaper and online job ads, casting a wide job search net, expanding their professional and personal networks, and staying abreast of new business openings and expansions in their areas.”