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SHRM Report: Job Growth Will Slow Down In June
New-hire compensation and difficulty in finding qualified job candidates rose in May
Alexandria, Va. – Job growth in the manufacturing-sector will increase slightly and service-sector hiring will drop moderatelyin June compared with a year ago, a monthly survey of human resource professionals at more than 1,000 companies shows.
The Society for Human Resource Management’s (SHRM) Leading Indicators of National Employment® (LINE®) Report, includes the only national employment index of HR professionals’ month-ahead hiring expectations, shows that despite slowing job growth, new-hire compensation inched up in May, as did the difficulty in finding qualified job candidates.
The report shows that the manufacturing hiring index will increase by a net of 2.1 points compared with a year ago, while the service sector will drop by a net of 14.4 points.
"Though companies are still adding jobs, the rate of improvement compared to the same time last year has leveled off in the past few months,” said Jennifer Schramm, manager of workplace trends and forecasting at SHRM. “While year-over-year comparisons are still showing a positive increase from June 2010 in manufacturing, we haven’t seen the same in services.”
Over half of manufacturers (54.2 percent) plan to hire in June, while 7.2 percent intend to cut jobs. Hiring is up slightly compared to one year ago, when 51 percent of organizations planned to hire and 6.1 percent planned to cut jobs in June.
Service-sector hiring will drop moderately compared to one year ago, with 45.2 percent of employers intending to hire and 8.8 percent cutting jobs. One year ago, 57.7 percent of service-sector organizations planned to hire, while 6.9 percent planned to cut jobs.
Released the first Thursday of each month, the LINE Report provides a snapshot of anticipated hiring for the month ahead and also examines data from the previous month.
The SHRM LINE Report shows that new-hire compensation increased in May, and HR professionals found it more difficult to find qualified candidates for open jobs – by a net of 8.6 points for the manufacturing-sector and a net of 13.1 points for the service-sector.
“The percentage of HR professionals in both manufacturing and services reporting increased recruiting difficulty for key vacancies continues to rise,” said Schramm. “More difficulty filling vacant positions is probably why new-hire compensation is also on the rise. May was the eighth consecutive month of year-over-year increases in the percentage of HR professionals in both sectors reporting an increase in new-hire compensation.”
The net total of service-sector companies that increased new-hire wages and benefits was 8.2 percent, an improvement of 6.3 points over last year when 1.9 percent of companies reported an increase in new-hire compensation packages. A net of 8.3 percent of manufacturing sector companies increased new-hire compensation packages in May, an increase of 4.6 points from a net of 3.7 percent one year ago.
The LINE Employment Report examines four key areas: employers’ hiring expectations, new-hire compensation, difficulty in recruiting top-level talent and job vacancies. The LINE Report is based on a monthly survey of human resource professionals at more than 500 manufacturing and 500 private service-sector companies. Together, these two sectors make up more than 90 percent of America’s private-sector employment.
Highlights of SHRM LINE year-over-year findings:
In June, hiring is up slightly in the manufacturing sector and down in the service sector.
In May, the index for recruiting difficulty rose in both sectors compared with a year ago.
The rate of increase for new-hire compensation in May rose on an annual basis in both manufacturing and services.
Source: SHRM Leading Indicators of National Employment
To read the SHRM LINE Report, visit: http://www.shrm.org/Research/MonthlyEmploymentIndices/Pages/default.aspx and click the “Latest LINE Report” button. Follow SHRM Research on Twitter @SHRM_Research.
Media: The SHRM LINE Report is released at 8:30 a.m. Eastern time on the first Thursday of each month. The SHRM employment expectations index describes the same time period referenced approximately one month later in the Employment SituationReport issued by the Bureau of Labor Statistics.
About the 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 250,000 members in over 140 countries, the Society serves the needs of HR professionals and advances the interests of the HR profession. Founded in 1948, SHRM has more than 575 affiliated chapters within the United States and subsidiary offices in China and India. Visit SHRM Online at www.shrm.org and follow us on Twitter at www.twitter.com/SHRMPress.
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