The good news: HR professionals are having more success finding top talent, according to the latest Society for Human Resource Management (SHRM) LINE Report, which identifies early trends and changes in the national job market.
The bad news: Manufacturing and service-sector employment expectations are at the lowest levels in October in four years, and a weak overall labor market might be leading to fewer job vacancies.
The Leading Indicators of National Employment (LINE) Report for October 2008, released Oct. 3, is based on a monthly survey of HR executives at more than 500 manufacturing and 500 service-sector organizations. These two sectors together employ more than 90 percent of the nation’s private-sector workers.
Findings are based on four areas: employers’ hiring expectations in the manufacturing and service sectors, difficulty in recruiting A-level talent to fill strategically important vacancies, the degree that compensation levels for new hires fluctuates for that month, and the job vacancy index.
Hiring expectations for October 2008 had dropped sharply in both sectors and are expected to reach the lowest October levels in four years, according to the report.
Also, expectations for hiring in manufacturing during October 2008 have “slowed dramatically” compared to October 2007, while expectations for hiring in the service sector during October 2008 are expecting “a sharp decline” from October 2007, according to the report.
Attracting top talent in the manufacturing and service sectors is becoming easier, the report found. The recruiting difficulty index measures how difficult it is for employers to recruit A-level candidates to fill positions that are of greatest strategic value to employers.
The new-hire compensation index, which measures whether compensation for new hires is going up or down, shows a slight uptick in manufacturing but a slowing in the service sector compared to October 2007.
Compared to October 2007, though, fewer of those surveyed in the manufacturing sector are reporting actual increases to their compensation packages, the report notes, calling it “an indication that more companies are keeping compensation flat.”
In the service sector, increases in compensation packages for new employees “are also being handed out more sparingly” than a year ago, the report says.
Vacancies in exempt and nonexempt employment are falling, and the report suggests that with a national unemployment rate at a five-year high, more people are filling vacancies at a faster pace.
The numbers of vacancies for exempt positions—primarily salaried jobs—in both the manufacturing and service sectors are “down by large margins,” according to the report.
Manufacturing saw “a steep decline” in exempt vacancies, and the service sector is seeing more declines than increases in vacancies for exempt positions.
Nonexempt (hourly) positions in the service sector are experiencing a dramatic drop compared to October 2007 and have fallen in manufacturing from one year ago, the report says.
LINE has been measuring the manufacturing trends since 2004 and the service-sector trends since 2005. Starting in September 2008, this report from SHRM is being released the same day as the Bureau of Labor Statistics’ Employment Situation Report for the same period.
Kathy Gurchiek is associate editor for HR News. She can be reached at email@example.com.