Thu, Jan 6, 2011
Today’s Monster Employment Index (MEI) once again underscores that the recovery is headed in the right direction. I’m particularly pleased that the 13% year over year increase in December marks an 11 month trend of significant annual growth.
Many anxious observers, however, would like to see a more rapid acceleration in the recovery.
The 8 million jobs lost during the recession won’t be replaced overnight and any expectation that they would is idealistic. Instead, I think we should welcome smart and sustainable recovery in the market.
The latest economic data released points towards an optimistic, but measured, economic climate: factory output climbed for a fifth consecutive month in November; retail sales rose for a fifth consecutive month in November; private sector payroll gains (MoM) have been positive for 11 consecutive months in November.
In short, gradual improvement is being seen, while unemployment (9.8 percent in November) and housing market weakness serve as persistent counterweights to a full recovery. Within this climate, online recruitment has maintained a measured pace of annual growth.
At this time each year, we’re more interested in looking ahead and not dwelling on the past – and to that point, I remain confident in the economic outlook for 2011.
I’m not an oracle or even someone that is particularly fond of placing bets, but I believe the trends represented in the MEI reinforce that there are areas of opportunity in the labor market. More specifically:
1. Utilities On Top: This proved to be the top-moving sector in the December Index. Annual Index growth for the sector accelerated from 18 percent in November to 28 percent in December as sector employers ramped up online opportunities at the end of the year.
Behind the rise was strong demand for field workers ahead of the winter months, especially in the Midwest and Northeastern regions. Aside from seasonal factors, demand appears driven by a push for technological/infrastructure upgrades.
2. Headwinds in the Professional, Scientific, and Technical Services Sector; Finance and Insurance Sectors Show Gains: This is where annual growth slowed as a result of deeper than usual reductions in recruitment in December. A sub-sector in the Finance/insurance industry worth watching is M&A.
Even as corporate and consumer lending persists at a relatively stagnant level, it is undeniable that a sizable number of companies are profitable, which often leads to a rise in M&A activity as venture funds try to realized gains from previous investments.
3. Health Care and Social Assistance Sector Stable but Growing: The healthcare/social assistance sector has historically been one of the most stable in the Index. While healthcare is a very broad sector, we do see increased demand for talent with experience as occupational therapists, physical therapists, and speech pathologists.
4. Technology Gains Big: As an occupational category, computer and mathematical has consistently shown 20% annual index growth rate. This is also one of the biggest occupational categories by measure of job postings in the Index, so the recent rise reflects a robust turn in hiring trends.
Opportunities are especially expanded in the small business sector, as smaller companies begin investing in tech with the ongoing recovery. This trend will likely continue in 2011 with increased demand in the long term for security specialists, software engineers and Web developers.
5. Hiring Increases for Front Line Sales Positions: Finally, as we have seen in the past as we came out of the 2001-2002 period, as the economy grows and recovers from challenging economic times; businesses want to capitalize on this growth by garnering additional sales/revenue.
Once businesses feel they have sustainable new growth, business will hire support personnel to service this new business, which might include Customer Service Representatives, Consultants, Marketing Specialists, Sales Reporting Analysts and similar support positions.
I’m often asked how recruiters and HR professionals can use the MEI to optimize their talent management strategies. I recently discussed just that with John Zappe at ERE and the conversation can be found here.
My interview with John reinforces today’s recruitment reality: Data will play a critical role in helping smart companies navigate, and win, the war for talent in 2011.