SHRM/Rutgers LINE® Index Forecasts December Drop in Manufacturing and Service-Sector Hiring

For Immediate Release

Nov 27, 2007

Alexandria, Va. ─ According to new numbers from the SHRM/Rutgers Leading Indicator of National Employment® (LINE®), both manufacturing and service sector hiring will decline significantly in December 2007. The report projects that not only will fewer Americans be hired in December than a year ago, but those who do gain employment will earn less than new hires did last year.

“Employers generally expect to recruit fewer new hires next month and offer lower compensation than they did in December 2007,” said Jennifer Schramm, SHRM manager of workplace trends and forecasting.

“The one bright spot in the forecast is that employment will remain steady among non-exempt manufacturing jobs,” Schramm said.

These findings are reported in the December 2007 LINE employment expectations report, an economic indicator that forecasts changes four national employment measures: job expectations, job vacancies, new-hire compensation and recruitment difficulty. The LINE index is an early indication of the monthly Bureau of Labor Statistics (BLS) report, which is released five weeks later. Also, LINE provides the only published index of new-hire compensation.

Manufacturing Sector:

The LINE index of manufacturing employment expectations forecasts a drop in hiring expectations of employers for December 2007 (27.6) compared to December 2006 (31.5).

However, this decline is likely to affect exempt or salaried employees more than non-exempt workers. Employers reported a rise in the vacancy rate index among exempt manufacturing jobs for November, the month leading into the December forecast —11.2 during November 2007 versus 8.6 in November 2006.

In contrast, the vacancy rate index of non-exempt manufacturing jobs dropped to 5.4 in November 2007 from 8.8 in November 2006.

In the measure of planned recruiting activity by employers, there was a significant decrease in the LINE recruiting difficulty index — 10.4 in November 2007 versus 20.9 in November 2006.

Projected compensation for new hires in manufacturing also declined. The manufacturing new-hire compensation index for November 2007 dropped to 7.6 from 11.9 in November 2006.

Service Sector:

The LINE index of service-sector employment expectations forecasts weaker growth for December 2007 (33.3) compared with December 2006 (41.4).

The service-sector exempt employment vacancy index jumped from -6.1 in November 2006 to 11.0 during November 2007 as did the nonexempt employment vacancy index from -7.8 in November 2006 to 3.9 during November 2007.

The recruiting difficulty index is well below that of a year ago — 9.9 in November 2007 compared with 22.8 in November 2006.

The new-hire compensation index decreased from a year ago — 6.6 in November 2007 from 10.1 in November 2006.

About LINE

This SHRM/Rutgers LINE indicator of employment expectations provides an early snapshot of anticipated U.S. hiring for the same December period as the report the BLS will release in January. The monthly report forecasts changes in national employment by surveying human resource professionals at more than 500 manufacturing and 500 service sector firms. Responses in the LINE survey are weighted using the proportion of total employment represented by the respondent’s industry.

The LINE report is a collaborative effort between the Society for Human Resource Management (SHRM) and the Rutgers University School of Management and Labor Relations. The SHRM/Rutgers LINE report began forecasting manufacturing sector hiring trends four years ago and service sector three years ago.

Society for Human Resource Management

The Society for Human Resource Management (SHRM) is the world’s largest association devoted to human resource management. Representing more than 225,000 individual members, the Society’s mission is both to serve human resource management professionals and to advance the profession. Founded in 1948, SHRM currently has more than 576 affiliated chapters within the United States and members in more than 135 countries. Visit SHRM Online at

School of Management and Labor Relations at Rutgers

The School of Management and Labor Relations at Rutgers, the State University of New Jersey, is a leading center of scholarly and applied research on human resource management issues. The school creates and disseminates knowledge that fosters a better understanding of the nature of employment and work in modern society. The Rutgers Master of Human Resource Management degree is one of the top human resource management programs in the nation.


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