Job Hunting

Hiring Standstill: It Could Be Worse

Amid news of layoffs, at least two new surveys say the majority of companies will hold tight until they can figure out consumer demand. But demand ...
Stephen TaubMarch 10, 2009

As job cut announcements continue — United Technologies said today that it expects to cut 11,600 workers — staffing firm Manpower Inc. released a new survey that concludes that the majority of U.S. companies plan to hold employee levels steady until they get a better read on consumer demand. Further, examining a more narrow slice of the hiring pie, Robert Half International reported that most CFOs will maintain current staffing levels in their finance and accounting departments.

The Manpower study, which polled 31,800 employers, says that 67 percent of U.S. companies are planning no change in hiring during period between April and June. Further, 15 percent of the surveyed companies say that they will increase staffing levels over the next three months, while 14 percent plan to cut payroll during that period, which results in a 1 percent net employment outlook.

“We know that companies are having great difficulty forecasting consumer demand right now and that’s a key impediment to hiring,” said Jonas Prising, Manpower president, the Americas. “It’s like trying to make out the image in a stained glass window with no light behind it — it’s tough — so employers anticipate running lean until there’s more light.”

Two bright spots emerged from the Manpower survey, which carves up the economy by industry sector and geography. The construction sector, as well as the leisure and hospitality sector, anticipate increased hiring activity as compared to the first quarter. Meanwhile, the transportation and utilities sectors plan to keep hiring levels relatively stable for the second quarter.

As expected in a sputtering economy, the survey names several major industries that anticipate a decline in hiring compared to three months ago. Those sectors include mining, durable and nondurable goods manufacturing, wholesale and retail trade, information, financial activities, professional and business services, education and health services, and government.

Interestingly, Manpower points out that despite an expected increase in construction sector hiring, employers in that industry still report a negative net employment outlook.

According to the survey’s geographic breakdown, the each of the four U.S. regions expects weaker employment outlooks compared to last quarter and last year. Still, hiring in the Northeast is expected to be the strongest, while employers in the Midwest and West are less optimistic. Companies in the South, who reported the strongest hiring outlook in the first quarter, anticipate the weakest hiring pace in the second quarter.

Similar hiring trends were identified among CFOs. The Robert Half survey results showed that 86 percent of the 1,400 CFOs surveyed for the company’s Financial Hiring Index expect to maintain current staff levels in their accounting and finance departments over the next three months. Five percent of the respondents claim that they plan to add full-time employees, while 7 percent expect to cut staff.

Despite climbing unemployment rates, some CFOs continue to report difficulty finding skilled professionals for certain functional areas, according to Robert Half. For instance, 25 percent of the finance chiefs polled cited accounting positions as the most difficult to fill, and 19 percent said they experience the greatest challenges when hiring for finance roles.

The Index also breaks down the economy into geographic regions and industrial sectors. According to the data, CFOs in the West South Central states expect the most hiring activity in the second quarter. A net 4 percent of CFOs in the region project additional hiring of full-time accounting and finance staff. In addition, 11 percent plan to add employees, while 7 percent forecast staff reductions.

“A diverse industry base, including sectors such as oil and gas that remain steady, has helped the West South Central weather some of the economic turmoil and maintain pockets of growth,” noted Robert Half chairman and CEO Max Messmer. “Companies need mid-level general accountants, controllers and senior audit managers, and they place a particular priority on professionals able to assist in multiple areas.”

Among industries, 6 percent of CFOs from the professional services sector say they will increase hiring in the second quarter, and 4 percent plan to cut employees. Another net 2 percent increase in hiring is expected from CFOs in the finance, insurance and real estate sector, who also said they will expand their finance and accounting staff levels.