Over the past several months, private employment in the U.S. has
begun to rebound in an increasingly strong way. Through all of
2011, the private sector averaged 160,000 new positions per month,
exceeding the monthly rates of population growth (about 140,000)
and labor force growth (only about 20,000).
“Everyone is hearing about continued debt concerns in Europe,
but when it comes to not hiring in America, it’s used as an excuse
not to hire, rather than a reason,” notes Rob Romaine, president
ofMRINetwork. “Except for companies with heavy exposure to the
European market, businesses are making hiring decisions based on
the customers walking through their front door, not uncertainty
surrounding sovereign debt an ocean away.”
A recent survey ofMRINetwork recruiters noted an increase over
the last six months of employers backfilling positions that had
been left unfilled for two years or more. As one respondent said,
“I believe [employers] cut so deeply over the past two years that
productivity has suffered. Today, they are hiring out of necessity
and a belief that the economy has begun to turn.”
The evidence that the economy has turned is mounting. According
to the Bureau of Economic Analysis, the U.S. economy grew at an
annualized rate of 2.8 percent during the fourth quarter of 2011,
the fourth consecutive increase. U.S. GDP in 2011 grew 1.7 percent,
not a rapid growth, but a far cry from projections of a double-dip
recession.
Such growth numbers are, compared to past periods of recovery,
rather weak. Yet, most important is where the growth is coming
from. In 2011,MRINetwork saw placements in the construction space
grow by nearly 50 percent, industrial placements by more than 30
percent and consumer products and services by more than 20
percent.
“Increased hiring of senior-level talent in these sectors is
promising for the general economy,” says Romaine. “It indicates a
confidence and a willingness by employers to invest in talent
across broad swaths of the economy despite headwinds that still
persist.”
But just as employers seem to be ramping up their hunt for
senior talent, the availability of such talent may be shrinking as
well. Over the last six months, employers have continued to
increase their use of counter-offers, hoping to retain top talent
long enough to backfill their positions. In highly technical
fields, such as chemical engineering or biotechnology, employers
have been forced to sweeten counter-offers because there simply
aren’t as many candidates as there are job openings.
Indeed, the unemployment rate for those with a bachelor’s degree
or higher-perhaps the broadest definition of the skilled,
professional workforce-fell in December to 4.1 percent, its lowest
rate in nearly three years.
“A full-blown, double-dip recession in Europe could have a
chilling effect on hiring in America. But, until it does impact the
U.S. directly, businesses are beginning to return to more normal
hiring patterns,” notes Romaine. “Companies are backfilling
vacancies and investing in new positions. We are in the midst of
the slow, but seemingly stable, rebound that had been
projected.”

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In January, total employment in the United States grew in excess of 200,000 jobs for the second consecutive month. The Labor Department reports 243,000 positions were added in the month and revisions show 203,000 were added in December. The U.S. unemployment rate fell from 8.5 to 8.3 percent despite an influx of more than 500,000 workers into the civilian labor market.

Furthermore, revisions to previous numbers, based on more complete data, show the employment situation may not have been as bad as first reported. Unemployment peaked at 10 percent for a single month in October 2009 before starting to fall. Past reports had unemployment remaining at or above 10 percent for three months. Revisions to 2011′s establishment data also show nearly 266,000 more jobs were created during the year than previously reported, accounting for nearly a 20 percent improvement.
Growth did not appear overly clustered in any specific sector in January, but rather it was spread throughout many
sectors. Manufacturing added 50,000 positions, mostly in durable goods, likely an extension of holiday spending which seemed to disproportionately lean towards such items. Food services and drinking places added 33,000 positions, healthcare added 31,000 and construction added 21,000. In the temporary help or contract
staffing space, employment grew by 20,100 after having been relatively flat in recent months.

The unemployment rate among those who hold a four-year degree rose from 4.1 to 4.2 percent in January, but that was mostly driven by an increase in those who hold such a degree looking for work. Actual employment by those with a four-year degree rose by 291,000 in January. The management, professional and related occupations unemployment rate fell year over year from 4.7 percent to 4.3 percent. The unemployment rate for those in sales or related
occupations also fell, from 9.1 to 8.2 percent from a year ago.

The recovery from the Great Recession has been characterized by fits and starts. Indeed, when comparing the speed
of the labor market’s recovery to past recessions, our current path is both longer and slower than any recovery over the last half century. The improvements seen over the last few months though, point to the beginning of a virtuous cycle, with an unemployment rate falling more precipitously than would have been projected just a few months ago.

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