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Is the U.S. job market finally starting to thaw, or is this déjà vu?
Remember 2011’s strong start? From February to April 2011, U.S. employers created an average of 239,000 jobs per month. Then from May to July 2011 that rate fell by two-thirds; only an average of approximately 78,000 jobs per month was added during that time frame, according to data tallied by the U.S. Bureau of Labor Statistics (BLS).
Fast-forward to 2012. January 2012’s BLS report showed an increase of 284,000 jobs; 227,000 jobs were created in February 2012, and 120,000 jobs were added in March 2012.
So are we headed for another letdown? It’s too soon to tell, but some hiring professionals and employment organizations are actually showing more faith in the job market in 2012.
According to the Society for Human Resource Management’s Jobs Outlook Survey for the second quarter of 2012, 58 percent of respondents have some level of confidence in the U.S. labor market and expect job growth for the April-to-June 2012 time frame. That’s up sharply from 34 percent of respondents in the fourth quarter of 2011.
There’s also a positive report for the much-maligned young workers, whose unemployment rates have soared during this post-recession period. The National Association of Colleges and Employers (NACE) said that employers will hire 10.2 percent more college graduates in 2012 compared with 2011. Even better news for graduates with high skill sets: 69 percent of the respondents to NACE’s most recent polling are seeking engineering majors for open jobs in 2012, followed by those with business degrees (63 percent), accounting degrees (53 percent) and computer science degrees (49 percent).
The bad (and now old) news is that there is still an imbalance between some job seekers’ qualifications and the qualifications needed for positions available today.
A new report by McKinsey Global Institute found the skills gap is not going away anytime soon.
McKinsey’s research said that in 2011, 30 percent of U.S. companies had positions open for more than six months that they could not fill, and this was at a time when unemployment hovered above 9 percent.
The skills shortage is coming to a head in places like Memphis, Tenn., which had the third-highest hiring rate among major metro areas in 2011, according to new research by Gallup. Memphis city officials estimate they have at least 3,000 new jobs coming in the next couple of years because of hiring surges at certain large employers like Mitsubishi and Electrolux. Many of those positions are rooted in manufacturing, which has been a stalwart of the economic recovery but is also falling victim to the skills mismatch problem.
“There’s a great shortage of people who are educationally equipped for these jobs that are coming,” said Patricia Myers, a business services analyst with Workforce Investment Network, a division of the federally funded Workforce Investment Act program that serves the Memphis region’s labor market development needs.
Myers’ organization is collaborating with local industry groups, community colleges and businesses to mold the talent to fill those future openings. The process includes interviewing manufacturers to determine their specific skill requirements for new jobs and then developing curricula that address those needs, she said.
The Workforce Investment Network has applied for a federal grant in the range of $6 million to $12 million to assist with the skills gap effort.
“The grant would be phenomenal,” Myers said. “It would allow us to accomplish things much faster. But regardless of whether we get the money, we’re doing this anyway. We have no choice.”
Joseph Coombs is SHRM’s workplace trends and forecasting specialist.
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