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  According to an unpublished table of non-seasonally adjusted data from the Bureau of Labor Statistics, 4,488,000 Americans in April have been out of work for at least 27 weeks.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?

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.

 

Climate Change Could Impact Jobs

This week, Cargill Beef announced that it will be shuttering one of its Texas plants as a prolonged drought in the state thins cattle herds to their lowest levels in 60 years. The closure will force the plant’s 2,000 workers to relocate to one of the company’s other plants or find employment elsewhere. This is not the first time climate change has impacted jobs and it will not be the last, according to workplace authority John A. Challenger, chief executive officer of global outplacement consultancy Challenger, Gray & Christmas, Inc. Challenger forecasts that the impact of climate change on the economy and employment will only increase in the years to come. “Agriculture could be the biggest victim of changing weather patterns brought on by climate change. We are no longer an agriculture-based economy, but the sector still employs between 150,000 and 250,000 workers, depending on the time of year. The other area that could feel pain related to climate change is tourism. Ski resorts in Colorado are already seeing the effects of less snowfall. Not only are skiers seeking deeper powder further north, but the resorts are spending a lot more making artificial snow.” Not all of the fallout from climate change is negative. “In some areas, climate change could lead to more jobs. In Chicago, for example, where we have had less than two inches of snow this entire winter, construction workers and road workers have been able to continue working without weather-related stoppages. And, while it is difficult to imagine any silver linings in the aftermath of the increasing number super storms and hurricanes, such as the one that ravaged the east coast in October, there does tend to be increased economic activity and job creation in the areas impacted as cities and states clean up and rebuild.” The biggest and most positive impact on employment, Challenger hopes, will come from initiatives to address and reverse climate change, such as the development of new renewable energy sources and the manufacture of more energy-efficient transportation. What other industries could be impacted by climate change? How many jobs have been created by “green” initiatives? What sectors of the economy hold the most potential for creating green jobs? 

Seasonal Hiring Up More Than 10%

Despite some year-end uncertainty related to fiscal cliffs, a devastating hurricane and election-year politicking, retailers were confident enough in the final three months of 2012 to ramp up holiday hiring to its highest level in six years, according to an analysis of government employment data released by global outplacement consultancy Challenger, Gray & Christmas, Inc.

Employment in the retail sector increased by a net 728,300 jobs, between October 1 and December 31, according to non-seasonally adjusted data, released last week by the United States Bureau of Labor Statistics.  That is 10.3 percent higher than 2011, when retailers added 660,200 extra workers over the final three months of the year.  The nearly 730,000 retail jobs added this year represents the strongest year-end hiring surge since 2006, when employment in the sector increased by 746,900.

The bulk of the 2012 holiday hiring occurred in October and November, when employment grew by 149,600 and 490,400 workers, respectively.  Retailers hired just 88,300 additional workers in December, which was actually down significantly from the 147,600 workers added in December 2011.

“The fact that holiday hiring in the retail sector reached pre-recession levels is remarkable for a few reasons.  More people are working, but many are still under-employed and, as a result, wages have remained stubbornly low.  So, spending power this year was not necessarily greater than a year ago.  Additionally, more people are shopping online, where increased holiday demand is more easily met without adding a lot of seasonal workers.   Yet, despite these factors, brick-and-mortar retailers moved forward with increased hiring,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.

“An early Thanksgiving, which meant earlier Black Friday sales, may have contributed to an earlier hiring surge.  Additionally, a growing number of retailers opened their doors on Thanksgiving Thursday, which may have also boosted the need for extra hiring in order to ensure that enough workers were available to staff these holiday hours,” he noted.

Retail sales, excluding drug stores, increased 4.8 percent in December, according to Retail Metrics.  The International Council of Shopping Centers estimates that its members will show an increase about 4.0 percent total for December.  Meanwhile, e-commerce was up 14 percent for the entire holiday season, according to comScore.

“Some industry analysts are expecting retail sales to maintain some momentum into the new year, as consumers spend gift cards.  However, gift card traffic is unlikely to result retailers holding on to all of the extra holiday workers.  Some may stay, but the vast majority will be let go,” said Challenger.

After adding 660,200 seasonal workers over the final three months of 2011, retail employment fell by 789,400 in January and February 2012.

JOBS ADDED IN RETAIL TRADE

October, November, December, 1999-2012

Oct Nov Dec TOTAL Job Growth Compared to Previous Year 1999 172,200 369,100 308,200 849,500 8.0% 2000 143,600 393,800 250,800 788,200 -7.2% 2001 95,700 352,100 137,500 585,300 -25.7% 2002 125,800 350,500 193,200 669,500 14.4% 2003 145,000 305,100 189,800 639,900 -4.4% 2004 158,000 371,800 180,700 710,500 11.0% 2005 122,300 392,700 196,600 711,600 0.2% 2006 150,600 427,300 169,000 746,900 5.0% 2007 87,900 465,400 167,600 720,900 -3.5% 2008 38,600 213,600 72,700 324,900 -54.9% 2009 45,100 317,100 133,600 495,800 52.6% 2010 149,800 339,200 158,600 647,600 30.6% 2011 128,900    383,700 147,600 660,200 1.9% 2012 149,600    490,400 88,300 728,300 10.3% AVERAGE 122,364 369,414 171,014 662,793   Source: Challenger, Gray & Christmas, Inc., with non-seasonally adjusted data provided by the Bureau of Labor Statistics

 

JOBS LOST IN RETAIL TRADE
January, February, 2005-2012
Jan Feb TOTAL 2005 -655,600 -139,400 -795,000 2006 -692,800 -178,400 -871,200 2007 -640,000 -160,600 -800,600 2008 -698,100 -232,700 -930,800 2009 -736,000 -249,200 -985,200 2010 -572,800 -167,700 -740,500 2011 -559,700 -166,500 -726,200 2012 -568,700 -220,700 -789,400

 

Source: Challenger, Gray & Christmas, Inc., with non-seasonally adjusted data provided by the Bureau of Labor Statistics

November Holiday Hiring Strongest On Record

Retailers added 465,500 seasonal workers in November, the most ever added during what is typically the busiest hiring month of the holiday hiring season, according to an analysis of non-seasonally adjusted data from the Bureau of Labor Statistics by global outplacement firm Challenger, Gray & Christmas, Inc.

The net gain in retail employment achieved last month barely surpassed the previous record set in 2007, when retail payrolls grew by 465,400 workers during the month of November.

November job gains were up 21 percent from the 383,700 seasonal workers hired by retailers a year ago.  Furthermore, October job gains in the retail sector were adjusted upward to 145,200 from an originally-reported figure of 130,100.

Challenger’s 27th Annual Job Seeker Call-In Dec. 27th & 28th

As the job market continues to recover at a snail’s pace and millions of Americans struggle to overcome long-term unemployment, global outplacement firm Challenger, Gray & Christmas, Inc. will suspend normal business operations for two days so that its staff of professional counselors can provide free job-search advice to callers from across the country.

The firm’s 27th annual two-day national job-search call-in takes place December 27 and 28, from 9:00 a.m. to 5:00 p.m. CST.  The telephone number is 312-422-5010.  

Could Black Thanksgiving Cause Backlash?

Facing increased competition from online retailers, a growing number of brick-and-mortar stores, including Target, Sears and Walmart, have announced that they will begin Black Friday sales on the Thursday of Thanksgiving, with some stores opening as early as 8pm, a time many employees might otherwise spend with family.  The move, according to one workplace authority, is likely to pay off for both retailers and job seekers, but warns there is the risk of negative fallout in the form of decreased employee morale and consumer backlash.

“Retailers are under immense pressure to get the holiday shopping season off to a strong start.  It is the busiest time of the year for them and Black Friday is so named because it is the day when most retailers’ sales move ‘into the black’ for the year.  As big box chains face growing competition from discounters like Target and Walmart, not to mention the fierce competition from online retailers like Amazon.com, they are all compelled to find whatever edge they can to get shoppers into their stores,” said John A. Challenger, chief executive officer of global outplacement firm Challenger, Gray & Christmas, Inc.

“That being said, these retailers are opening themselves to a potential backlash from the decision to open on what many consider to be a day that it is best spent with family, reflecting on all that we are thankful for.  Not only is there the risk of creating disgruntled workers, who feel they have no choice but to accept the holiday hours in this economy, but in the wake of the worst recession since the Great Depression, some Americans have soured on the corporate excess and the profits-at-any-cost mentality that some say helped hasten the economic meltdown,” said Challenger.

Retailers Add 130K Jobs In Oct, Slightly Better Than 2011

 While several large retailers have announced large-scale holiday hiring plans, employment gains in the retail sector last month were virtually unchanged from a year ago, according to an analysis of the latest Bureau of Labor Statistics data by global outplacement firm Challenger, Gray & Christmas, Inc.

The 130,100 retail job gains last month were only slightly more than the 128,900 retail jobs added in October 2011.  The first month of holiday hiring both this year and last were down significantly from the 149,800 retail jobs created in October 2010.

While 2011 started slowly, retailers added another 531,300 workers in November and December for a total of 660,200 seasonal employment gains, the highest level since 2007.  In 2008 — the worst holiday-hiring season in 22 years — retailers added only 38,600 seasonal workers in October and only 324,000 total workers during entire holiday season of October through December.

“November will give us the best indication of how 2012 stacks up when it comes to holiday hiring.  It is likely that a lot more of the holiday hiring plans announced by national retailers, including J.C. Penney, Kohl’s, Best Buy and Macy’s, will show up in the November hiring figures,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.

“It remains to be seen how the aftermath of Hurricane Sandy could impact retail hiring on the east coast.  These were highly populated areas that were affected.  There is a good chance that many people in the region will still be trying to rebuild their lives when the peak holiday shopping season starts in a few weeks.  Buying Christmas presents could fall pretty low on the list of priorities, which may mean that retailers in this area – many of whom are also facing significant damage – may hold off on planned holiday hiring,” said Challenger.

In its annual holiday hiring forecast released in September, Challenger predicted that seasonal hiring would be about the same or slightly higher than a year ago.

“Even before Hurricane Sandy, there was little evidence to suggest that retailers would return to the pre-recession levels of seasonal hiring, when retail employment gains averaged more than 720,000 extra workers added over the final three months of the year.  Retail sales are stronger than a year ago, but the economy is still a long way from full recovery and with more than 12 million Americans still unemployed, there are still a lot of potential holiday shoppers who remain on a very tight budget,” said Challenger.

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JOBS ADDED IN RETAIL TRADE

October, November, December, 1999-2012

Oct Nov Dec TOTAL Job Growth Compared to Previous Year 1999 172,300 369,000 308,100 849,400 8.0% 2000 143,700 393,800 250,600 788,100 -7.2% 2001 95,700 352,000 137,600 585,300 -25.7% 2002 125,900 350,400 193,300 669,600 14.4% 2003 145,100 305,000 189,900 640,000 -4.4% 2004 157,800 371,800 180,600 710,200 11.0% 2005 122,300 392,700 196,400 711,400 0.2% 2006 150,600 427,200 169,000 746,800 5.0% 2007 87,900 465,400 167,500 720,800 -3.5% 2008 38,600 213,500 72,800 324,900 -54.9% 2009 45,100 317,000 133,700 495,800 52.6% 2010 149,800 339,200 158,600 647,600 30.6% 2011 128,900 383,700 147,600 660,200 1.9% 2012 130,100 130,100   AVERAGE 120,986 360,054 177,362 620,014     Source: Challenger, Gray & Christmas, Inc., using non-seasonally adjusted data provided by the Bureau of Labor Statistics

Announced Seasonal Hiring
September/October
Target	90,000
Macy’s	80,000
Kohl’s	52,700
Walmart	50,000
Amazon	50,000
Toys R Us	45,000
JC Penney	40,000
PartyCity	20,000
FedEx	20,000
GameStop	17,000
Best Buy	14,000
Hickory Farms (Food)	5,225
TOTAL	483,925

List compiled by Challenger, Gray & Christmas, Inc.

Amazon To Add 50,000 Seasonal Workers

Amazon To Hire 50,000 Seasonal Workers

Amazon will hire 50,000 temporary workers for the holiday season, adding to the ever-growing list of seasonal hires. Similar announcements have come from big-box retailers Wal-Mart and Target, as well as from Toys R Us, Macy’s, JC Penney, and Best Buy. Challenger predicts this year will see better hiring than last, but we are far from pre-recession levels.

 

Announced Seasonal Hiring
Target	Retail	90,000
Macy’s	Retail	80,000
Kohl’s	Retail	52,700
Wal-Mart	Retail	50,000
Amazon	Retail	50,000
Toys R Us	Retail	45,000
JC Penney	Retail	40,000
PartyCity	Retail	20,000
Gamestop	Retail	17,000
Best Buy	Retail	14,000
Hickory Farms	Food	5,225
TOTAL		463,925

 

Update on Teen Hiring: Summer Employment Up 13%

Teenagers saw their strongest summer job gains in five years, as an improving economy and less competition from older job seekers helped nearly 1.4 million 16- to 19-year-olds find employment in May, June, and July, according to an analysis of non-seasonally adjusted jobs data from the Bureau of Labor Statistics by global outplacement firm Challenger, Gray & Christmas, Inc.

Employment among 16- to 19-year-olds grew by 382,000 in July, the final month of the annual teen hiring period.  July job gains were up 26 percent from 2011, when teen employment increased by 302,000.  Overall, the number of employed teens grew by 1,397,000 from May through July, which represents a 29 percent increase from the previous summer, which saw 1,087,000 teens added to the employment rolls.

This summer’s job surge among teens was the largest since 2007, when teen employment experienced a net gain of 1,635,000 over the three-month hiring period.  Teen employment can be expected to shrink in August as 16- to 19-year-olds return to school.  Over the previous five years, the number of employed teenagers fell in August by an average of 523,000.