Not a Member?  Become One Today!

LINE: Hiring Still Slow; Data Hint of Dearth in Qualified Job Seekers

By Theresa Minton-Eversole  11/5/2010

The U.S. private-sector labor force is expected to make small gains in hiring in November 2010, but the pace of job increases remains sluggish, according to the Society for Human Resource Management’s (SHRM) Leading Indicators of National Employment (LINE) survey data for November 2010.

Manufacturing and service companies are expected to add more workers in November 2010 compared with a year ago, but opportunities are still limited for job seekers.

“Although HR professionals are reporting small gains in hiring in November [2010] compared to the same time last year, improvements in hiring expectations have slowed considerably in recent months, especially in manufacturing,” said Jennifer Schramm, GPHR, SHRM’s manager of workplace trends and forecasting. “On a monthly basis, the manufacturing employment expectations index has actually dropped over the past three months.”

The LINE report examines employers’ hiring expectations and job vacancies, recruiting difficulties and new-hire compensation. The report findings are based on a monthly survey of private-sector human resource professionals at more than 500 manufacturing and 500 service-sector companies that together employ more than 90 percent of the nation’s private-sector workers.

Employment Expectations




In November 2010, hiring will increase in manufacturing and services on an annual basis for the 13th straight month.








Recruiting Difficulty




In October 2010, the index for recruiting difficulty rose modestly in both sectors compared with a year earlier.










New-Hire Compensation




The rate of increase for new-hire compensation in October 2010 rose slightly on an annual basis in both sectors.








Source: SHRM Leading Indicators of National Employment (LINE),

Employment Expectations

The manufacturing hiring index will improve in November 2010 on a year-over-year basis by a net of 10.7 points (a net of 28.5 percent of employers will hire compared with 17.8 percent that added jobs in November 2009). The service hiring index will rise in November 2010 by a net of 11.3 points (a net of 27.1 percent of employers will add jobs, compared with a net of 15.8 percent that added jobs in November 2009). But the pace of hiring has ebbed considerably during the past three months for both sectors.

Job openings for salaried positions rose in both sectors in October 2010. In the manufacturing sector, a net total of 15.8 percent of respondents reported increases in exempt vacancies in October 2010, a 9.6-point increase from October 2009. In the service sector, a net total of 15.1 percent of respondents reported increases in exempt vacancies in October 2010, a 13.2-point increase from October 2009. This represents the 15th consecutive month for both sectors that exempt vacancies are higher than those of the same month the previous year.

A net total of 20.3 percent of manufacturing respondents reported that nonexempt vacancies also increased in October 2010 compared to October 2009. Still, hiring has leveled off in manufacturing in the second half of 2010, according to the U.S. Department of Labor’s Bureau of Labor Statistics (BLS) and LINE data. The rise in vacancies could be an indication that companies are having trouble finding workers with the skills needed for jobs, and might be driven partially by growth in the professional and business services sector, which added 28,000 jobs in September 2010, according to BLS.

For nonexempt service positions, a net total of 19.6 percent of respondents reported increased vacancies in October 2010, a 4.0-point jump from October 2009.

Recruiting Difficulty

LINE’s recruiting difficulty index measures how difficult it is for firms to recruit candidates to fill the positions of greatest strategic importance to their companies. Although the increase was small, more HR professionals had an increase in difficulty recruiting for key positions in October 2010 compared with October 2009.

“What is interesting is that even though employment expectations in both sectors seem to be slowing down somewhat, at the same time HR professionals are reporting that they are having a bit more difficulty recruiting for their key strategic positions this October compared with [October 2009],” said Schramm. “This suggests that even though there are thousands of job seekers actively looking for work, hiring managers seeking highly skilled workers are having some challenges finding the talent they need.”

Considering millions of people are actively seeking work and still cannot obtain employment in their industries, the rise in recruiting difficulty in both sectors might be attributed to new or enhanced skill requirements for new, high-level jobs in manufacturing and services, noted the report.

New-Hire Compensation

Compensation packages for new hires also rose in October 2010. The rate of increase for wages and benefits rose on an annual basis in the manufacturing and service sectors.

In the manufacturing sector, a net total of 3.2 percent of respondents reported increasing new-hire compensation in October 2010, an increase of 3.3 points from October 2009. In the service sector, a net total of 6.3 percent of companies increased new-hire compensation in October 2010, representing an increase of 4.1 points from October 2009, when a net of 2.2 percent of service companies increased new-hire compensation. But overall, the low rates of change in both sectors indicate that most organizations are keeping new-hire compensation rates flat and that many people landing jobs are continuing to accept lower wages and benefits as the labor market remains weak.

Theresa Minton-Eversole is an online editor/manager for SHRM.

Copyright Image Obtain reuse/copying permission