How Are the Latest Employment Trends Impacting You?
As a member of the American Staffing Association (ASA), our team has access to a wide range of research and facts compiled by the ASA to provide its members and their customers with up-to -date news and data on employment trends.
Here are a few of their most recent briefings we thought might be of interest to our readers.
Employment Trend #1 – Talent Shortages are at an ALL TIME HIGH!
No surprise, huh? If you’re actively looking to hire, and its taking forever to find the right employee – you’re likely not alone.
But you might be surprised about how serious the issue really is. According to the US Bureau of Labor Statistics, the number of jobs waiting to be filled is outpacing the number of employees hired by about 200,000 employees each month. Current snapshot is that there are more than six million jobs that employers would like to fill right now, but can’t.
While talent shortages cross all sectors of our economy, healthcare, which is a big industry in the Puget Sound, leads the way. In fact, more than a third of projected job growth across all industries into 2024 will come from healthcare – no doubt driven by our aging population and increased access to healthcare insurance.
Job growth in the Professional and Business Services sector is close behind but in that sector the drivers of growth are targeted to come from the increasing reliance on the short term use of temps, contract workers and consultants (see trend # 4 which focuses on this trend).
In our local marketplace, the industry that rivals healthcare in their need for talent is IT. Application Software Developers for example are targeted to grow by 25-30% nationwide, even more here in Seattle. Any job that touches a computer whether it be in manufacturing, healthcare, creative services, or marketing will increase in numbers, creating increasing challenges for Puget Sound employers who regularly recruit for this type of talent. And yes, wages will continue to increase as candidate availability decreases – in some cases driving employers to look at alternative staffing options.
The Solution? If you’re not already taking steps to strengthen your recruiting expertise, to position your company as an employer of choice, to retain and develop your current employees, and to identify new and different ways to get work done, you’re already 3-4 steps behind. When it comes to anything involving talent – whether its finding, attracting, or retaining employees – you’re now in a very new and intensely competitive race! And the stakes for winning couldn’t be higher – in some situations , a key to survival!
Employment Trend #2 – Is it better to retain employees by promoting them or paying them more? It depends.
According to a recent study by well known executive and professional search firm, Korn Ferry, employees are quite split on what they prefer – a promotion or an increase in pay. Of the 850 professional staff they surveyed, 54% said they’d take the pay increase without promotion and 46% said they’d take the promotion, even without a raise.
The Solution? When it comes to motivating the professional employees on your staff, it looks like you need to ask before assuming that either a promotion or an increase in pay will keep them engaged. A strategy of promoting employees, providing them with elevated job titles that don’t quite reflect what they actually do, can be costly. Not only do you need to pay a promoted employee more, but you may have inadvertently put them into a role they didn’t want and aren’t prepared to do.
Employment Trend #3 – Do you know what you need to know about turnover?
A recent Workforce Turnover report from payroll service provider, ADP, showed that employers can use data to actually predict (and hopefully reduce) unplanned turnover.
Here’s what they discovered when studying turnover patterns of over 41,000 employers and 12 million employees:
- US businesses lose about 5% of their workforce each month due to voluntary or involuntary terminations.
- 60-70% of all terminations are voluntary….suggesting you’re not alone if you find yourself waiting for an under performing employee to quit before you terminate. It also suggests employers can easily be surprised when a top performer decides to leave – often for reasons you didn’t anticipate.
- Turnover has its seasons. The big month for terminations (voluntary and involuntary) is coming up soon – in September. The lowest rate of turnover is March.
- Turnover rates vary by industry. The ADP data shows that the leisure and hospitality industries lead the way in turnover, followed by construction, education and healthcare. Industries with surprisingly low levels of turnover include manufacturing, finance, and information services. From my perch it looks like the high growth industries – industries busy creating new jobs – are also the industries who have to be the most aggressive about their strategies for retention.
Turnover, particularly the unwanted kind, can be a serious issue for employers in tight recruiting markets. While unemployment is at a multi decade low, we know first hand that today’s employees are easy targets for competitive employers willing (and able) to pay more or offer more opportunity for advancement or promotion.
In the Greater Seattle marketplace, we find that a frequently sited reason for employees willing to change jobs stems from their desire to reduce a long commute. Working closer to home, avoiding spending time in long commutes is often a driving force in an employee’s decision to leave a job – even a job or employer they really like.
The solution? Hiring managers need to stay in tune with the employees on their team – proactively identifying issues that if addressed, could keep an employee in place. Flexible scheduling or periodic work from home privileges can go a long way to retain employees who might otherwise be tempted to look for a job closer to home.
Employment Trend #4 Temporary and Contract Employment has become a BIG TREND that is still leading the way!
Things couldn’t be better for most third party temporary staffing agencies.
- Temporary staffing agencies hired over 15.5 million employees to work for their clients in temporary or contract roles.
- 19 million employees worked at some time in 2017 in temporary or contract roles – the third highest use rate since 2006, the staffing industry’s benchmark year.
- The average length of assignment was 10.7 weeks – down just a bit from the 2016 average of 11.5 weeks. In our local market we think that reduction is at least partially driven by the popularity of the temp to hire staffing strategy. Employers are increasingly converting their temporary employees to their “permanent” staff following a 400-600 hour auditioning period popular in our area.
We see employers actually increasing their use of flexible or contingent staff as a recruiting strategy – a way to expand their recruiting resources with a ready pool of employees ready for the hire when the time is right.
In the big picture, the current increases in temporary and contract staffing are part of a larger trend that has been in play since the last recession (2007-08) when the US Bureau of Labor and Statistics predicted that the number of employees working in temporary or part-time roles would out pace the growth in regular employment until the year 2020.
The Solution? If you are a company or a hiring manager who has not yet fully embraced the trend toward more short term uses of talent, flexible work models, you may be caught short handed – particularly if your competitors are ahead of the curve and are getting the productivity and cost reduction gains that these alternative ways of configuring work can provide.
Employment Trend #5 What do you think is keeping your boss up at night? (A trend you need to know about)
A new study by Conference Board, suggests that the tight recruiting market is getting the attention of C Suite executives! When asked to rank 28 “hot issues”, their fear that their organizations are not attracting and retaining critical talent was their #1 concern – moving up 4 ranking points from the same study in 2017.
If you’re a hiring manager worried about finding and retaining the right talent, it look like you are in good company. If you’re a Talent Acquisition Manager or Recruiter who actually has a set of solutions to your CEO’s talent concerns, enjoy the job security!
Information for this article was compiled by Jeanne Knutzen, President and Founder of PACE Staffing Network, an award winning staffing and recruiting agency serving Northwest employers for over 40 years. PACE regularly recruits top talent for Puget Sound employers and has created a network of local specialized recruiting agency partners who together, deliver a unique ONE STOP staffing solution.
For more information on local employment or staffing trends you can reach our team by calling 425-637-3312 or email the PACE Employer Solutions team at firstname.lastname@example.org