Analysis: Labor Shortages Threaten Economy

Rising quit rates and fewer job seekers vying for open positions could signal a return to the types of labor shortages that plagued employers during the dot.com boom.  While widespread talent shortages are probably five to ten years away, some regions and industries already may be feeling the pinch, according to the workplace authorities at global outplacement consultancy Challenger, Gray & Christmas, Inc.

“With 11.6 million Americans still unemployed as of April, it may be difficult for most to contemplate labor shortages.  However, it is important that not all of the unemployed reside where jobs are being created at the fastest rate and many lack the skills required to fill the openings that exist.  These two factors alone make skill shortages a reality right now for some employers,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.

“As the economy continues to improve and more people find employment, labor shortages will only worsen; accelerated by an aging workforce that may not necessarily enter traditional retirement, but will alter their career path to the extent that it will prove disruptive to the companies that have employed them,” he added.

Challenger pointed to the latest jobs data from the Bureau of Labor Statistics (BLS) as evidence that it will become increasingly difficult for employers to attract and keep the best talent.  The April employment situation report showed that payrolls experienced a net increase of 165,000.  However, that figure from the BLS merely shows the difference between the total number of jobs added and the total number lost as a result of layoffs, terminations, retirements, people quitting, etc.  For the number of Americans actually hired in a given month, Challenger turns to the BLS job openings and labor turnover survey.

In March, the latest month for which data is available, the nation’s employers hired 4,259,000 new workers.  That was down from the previous month, when 4,451,000 Americans were hired.  However, the hiring levels tracked by the survey typically fluctuate significantly from month to month.  Overall, hiring levels have steadily risen since falling to a recession low in June 2009, when only 3,626,000 workers were hired during the month.

Get the full analysis here.

 

Bloomberg Breach Reminder of Online Privacy Issues

The recent news of Bloomberg reporters using financial data monitoring terminals sold by a separate division of the company to track customer activity, specifically at Goldman Sachs, emphasizes the stunning lack of privacy we encounter when we connect to the internet. While these products were not meant to be used in this way, reports from Forbes and the New York Times suggest that reporters were trained on these terminals to uncover customer browsing and get an edge on the 24/7 financial news cycle. In one instance, after a user of the product failed to log in to the terminal consistently, a reporter contacted the company to see if that person had left. “While this is an overt display of privacy invasion and disrespect for the customer, the fact is that our perpetual connection to the internet, on cell phones, laptops, and tablets, opens us up to intense and unceasing scrutiny,” warns John Challenger, CEO of Challenger, Gray & Christmas, Inc. “We must constantly keep in mind how our actions online reflect on us individually, both professionally and personally. Every time you sign up for a product online or a social media profile, a dossier of personal information is collected, maintained, bought and sold, and made searchable. We often hear of how a misguided or cynical tweet or Facebook post costs someone a job. This situation goes beyond ensuring your personal brand is cultivated by you and only you, and that you use social media as a public reflection of yourself, but it is a reminder that our connection to the internet does not stop with just the people we know.” What are best practices when using social media, both as a job seeker and an employee? What trends may emerge with the use of the internet as a way of tracking potential employees or employers?

 

 

April CEO Departures Reach 94, Financial Leads

Turnover among the nation’s chief executive officers rose slightly in April as 94 announced their departures during the month.  That is 9.3 percent higher than the 86 CEO exits in March, according to the latest report on chief executive officer turnover released Wednesday by global outplacement and executive coaching firm Challenger, Gray & Christmas, Inc.

April departures were 4.4 percent higher than the same month a year ago, when 90 CEO changes were recorded.

Through the first four months of 2013, 403 CEO departures have been announced, which is 2.0 percent fewer than the 411 tracked over the same period in 2012.

Get the full report here.

Tattoos in the Workplace? One Employer Says, “Absolutely”

Some employers frown upon tattoos and others begrudgingly accept them, knowing that sometimes the best talent comes adorned with body art.  However, one employer appears to have not only embraced tattoos, but is actually encouraging employees to decorate their bodies…with a tattoo of the company logo.  What do employees get for this extreme demonstration of loyalty?  A 15 percent bump in pay, according to a report last week by the CBS affiliate in Albany, New York.  Rapid Realty, based in Brooklyn, New York, even pays for the tattoos, which can cost up to $300.  Since the “loyalty program” was announced, 40 employees have been inked.  “In an era where job security is no longer guaranteed, particularly in an industry as volatile as real estate, it is surprising that so many employees would permanently brand themselves with an employer’s logo.  There is also a real risk that such a visible demonstration of loyalty will backfire if employees who did not get tattoos are treated differently or even perceive that they are valued less because of their decision,” noted John A. Challenger, chief executive officer of global outplacement firm Challenger, Gray & Christmas, Inc.  What are the pitfalls for both the employer and the employee in this type of loyalty building program?  How do most employers view tattoos in the workplace?  Are tattoos an obstacle to job-search success?  What are other ways that employers boost loyalty and morale?   

Bulletin: Youth, Long Term Jobless Biggest Obstacles To Recovery

The latest employment report revealed a job market that is most definitely improving.  That is, unless you are under the age of 20 or you have been out of work for more than six months.  Youth and long-term unemployment are not only inflating the unemployment rate, but they are a drag on the economic recovery.  According to an unpublished table of non-seasonally adjusted data from the Bureau of Labor Statistics, 4,488,000 Americans in April have been out of work for at least 27 weeks.  Of those, more than 3,000,000 (3,085,000) have been jobless for a year or longer.  “This prolonged unemployment takes a significant toll on the economy, not only in lost spending, but in lost tax revenue.  If politicians are truly concerned about reigniting the economy and fixing the deficit, getting these people back on payrolls should be the top priority,” said John A. Challenger, chief executive officer of global outplacement consultancy Challenger, Gray & Christmas, Inc.  Meanwhile, 16- to 19-year-olds represent less than 4 percent of the civilian labor force, but they account for nearly 12 percent of the unemployed.  “Teenagers typically earn less, but they are more likely to spend a greater portion of their earnings on food, clothes, entertainment, etc.  Ironically, these are the same areas that usually provide teenagers with the most job opportunities.  Unfortunately, due to slow job growth in higher-skilled, higher-paying occupations, the jobs that would normally be filled by teens are being filled by recent college graduates, stay-at-home mothers returning to the workforce, and seniors,” said Challenger.  What can policymakers do to get long-term unemployment back on payrolls?  What can long-term unemployed do to re-ignite job search?  How does the summer job market look for teenagers and what can they do to find these seasonal opportunities?

April Job Cuts Fall to 4-Month Low with 38,121

Job cuts fell to their lowest level since December, as U.S. employers announced plans to trim payrolls by 38,121 in April, according to the latest report on downsizing activity released Thursday by global outplacement consultancy Challenger, Gray & Christmas, Inc.

April job cuts were 23 percent lower than March, when announced layoffs totaled 49,255.  They were 6.0 percent lower than the 40,559 planned job cuts announced in April 2012.  April represents the lowest job-cut month since last December, when 32,556 were tracked by Challenger.

Through the first four months of 2013, the pace of downsizing is virtually equal to a year ago.  Employers have announced 183,162 job cuts to date, which is only 0.27 percent lower than the 183,653 planned layoffs announced in the first four months of 2012.

“The economic slowdown that began late in the third quarter and is expected to turn into another summer slump has yet to result in increased or widespread downsizing.  The biggest concern is that consumers, who had been holding up the economy for so many months, are starting to scale back their spending as wages continue to stagnate,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.

Consumer spending was up 0.2 percent in March, due primarily to increased heating costs during the unseasonably cold month.  Spending in other categories, such as household goods, retail and restaurants declined in March, according to the Commerce Department.

Read the full report here.

More Opportunities for Teens This Summer

More opportunities for teens this summer if they get off the computer and in front of employers.

Continued employment gains across the economy, but particularly in lower-skilled, lower-paying hourly wage categories, are expected to benefit teenagers seeking jobs this summer, according to a new outlook released Thursday by global outplacement consultancy Challenger, Gray & Christmas, Inc.

While job-seeking teens are likely to face competition from recent college graduates, as well as those at the opposite end of the age spectrum, employment gains for 16- to 19-year-olds in May, June and July should surpass last year’s levels.

“There will definitely be more opportunities for teenagers seeking employment this summer.  Of course, it is still a competitive environment.  So, teens should not expect employers to come knocking on their door.  The search will require maximum effort, starting now, in order to have a position lined up before the school year ends,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.

Get the full outlook here.

 

86 CEOs Left Their Posts In March

Turnover among the nation’s chief executive officers plummeted to an eight-month low in March as 86 CEOs announced their departures during the month.  That represents a 21 percent decline from 110 CEO exits in February, according to the latest report on CEO turnover released Wednesday by global outplacement and executive coaching firm Challenger, Gray & Christmas, Inc.

The March total is 8.5 percent lower than the same month a year ago, when 94 CEO changes were recorded. It was the lowest monthly total since 83 CEO changes were announced in July 2012.

Through the first three months of 2013, 309 CEO departures have been announced, which is 4.1 percent fewer than the 321 tracked in the first quarter of 2012.  The quarterly total is 4.3 percent lower than the 323 CEO changes in the final quarter of last year.

The healthcare sector has seen the heaviest CEO turnover so far this year, with 59 CEO changes announced through March.  The number of changes in the sector is down slightly from a year ago, when 63 first-quarter departures were announced by hospitals and other health care providers.  Health care has consistently seen the heaviest turnover over the last several years.  Last year, turnover in the sector increased 23 percent after falling to a six-year low in 2011. 

Get the full report here.

US Employers Announce 49,255 Job Cuts In March

The nation’s employers reported job cuts totaling 49,255 in March, a decline of 11 percent from the 55,356 cuts announced in February, according to the latest report on downsizing activity released Thursday by global outplacement consultancy Challenger, Gray & Christmas, Inc.  Despite the decline, quarterly job cuts reached their highest level since 2011.

March job cuts were 30 percent higher than a year ago, when employers announced plans to shed 37,880 workers from their payrolls.  This marks the second consecutive month and the fourth time in the last six months that the job-cut total was higher than the year-ago figure.

Employers have now announced 145,041 job cuts through the first three months of 2013.  That 5.6 percent higher than the previous quarter’s 137,361 job cuts and 1.4 percent higher than the 143,094 job cuts announced in the first quarter of 2012.  The first-quarter total is, in fact, the highest quarterly tally since 233,258 job cuts were tracked in the third quarter of 2011.

Get the full report here.

Hey College Grads, Things Are Looking Up

With college seniors around the nation returning to their respective campuses following spring break recess, many will undoubtedly turn their attention to their impending graduation and the search for their first post-collegiate job.  A new analysis of the entry-level job market estimates that while the job market continues to strengthen for college graduates, the environment remains highly competitive, which may force some to pursue unexpected career paths.

In its annual college graduate job-market outlook, global outplacement consultancy Challenger, Gray & Christmas, Inc. says this year’s crop of 1.8 million bachelor’s degree recipients will be able to take advantage of the 36 consecutive months of private-sector employment growth that has occurred since the jobs recovery began in earnest in March 2010.

“Job creation has been slow, but it has been steady.  Over the past 14 months, private payrolls have grown by an average of 190,000 new workers per month.  There are a growing number of opportunities for job seekers, but the search definitely requires an aggressive approach.  This is especially true for new graduates, who are likely to have less real-world experience to point to in job interviews,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.

“This lack of experience would have less impact if they were only competing for jobs with their fellow graduates.  However, in this economy, it is likely that they will be vying for entry-level job opportunities with those who have been in the workforce for one to five years.  They may even be competing with seniors looking for any opportunity to continue working even it means taking a dramatic cut in pay, title and responsibility,” he added.

Despite increased competition for entry-level positions, the latest data on starting salaries suggest that demand for new graduates is on the rise.  According to a January survey by the National Association of Colleges and Employers (www.naceweb.org), the average starting salary for new college graduates earning bachelor’s degrees increased 3.4 percent over last year.  The biggest gains were achieved by those in education, whose starting salaries rose by 5.4 percent from $38,581 for the class of 2011 to $40,668 for last year’s graduating class.

While those in education saw the biggest increase, last year’s graduates with a bachelor’s degree in engineering enjoyed the highest starting salary at $62,655, up 3.8 percent from $60,344 for 2011 graduates.

Engineering and technology graduates are likely to experience some of the shortest post-graduation job search times.  In fact, the most talented students in these fields may have multiple job offers to weigh before they even collect their diplomas, according to Challenger.

Read the full report here.