Staffing Experts Predict: Major Changes in the Job Market

Numbers released by the U. S. Department of Labor tell a bleak tale today: states in the West are being hit hardest by the nation’s lagging economy. In December 2002, Nevada experienced 5 percent unemployment, Arizona and Utah 5.6 percent each, and California an alarming 6.6 percent. With a probable war in Iraq and a lackluster stock market, employers, employees and the unemployed are all asking the same thing: Will it turn around, and when?

No one has a finger on the pulse of the nation’s economy and employment trends better than the staffing industry. According to the American Staffing Association, the industry generated $66 billion in revenue in 2001, $56 billion from temporary help services alone. Perhaps even more telling, 90 percent of companies use temporary help services to help with unexpected increases in business, temporarily fill a vacancy, fill in for an absent employee, work on special projects, help with seasonal needs and assist during peak times. An estimated 21 percent of companies use staffing services to help screen potential job candidates.

“I’m seeing that our client companies are delaying hiring additional employees right now, due to the possible war and our general economy,” said Marie C. S. Soucie, president of MCSS, Ltd., a full-service staffing agency in Reno. “There is a slow national need for products and services. As a result, businesses are still cautious about hiring.”

Soucie, whose firm handles staffing needs for executive searches, regular placements, temp-to-hire and temporary employees, said she predicts slow growth through the first quarter of 2003, but accelerated growth for the second and third quarters. She said “her crystal ball is broken” regarding the fourth quarter.

De-Andrea Harris, Southern Nevada branch manager for Westaff, one of the largest staffing companies in the nation, predicts a similar outlook. She said businesses are still cautious, but the majority are realizing the benefit of turning to an agency for employees.

“Coming to an agency to help develop their workforce can be the most cost-effective manner, in terms of both time and money, to bring on an employee,” said Harris. “For 2003, I think the market will see better-educated employers learning how to recruit and retain their employees for the long term.”

Jane Whisner, CTC, CTS, manages HR Solutions (human resources staffing and consultation) and Sales Staffing (national search, business-to-business sales) for the Eastridge Group, the largest privately held staffing firm in Southern California and Nevada, placing candidates in both short-term and full-time positions from more than a dozen offices. In talking to employees and employers, Whisner has unique insight into how the economy has impacted both.

“When the economy first slowed down about two years ago, HR departments were the first areas to feel the impact. Recruiters were the first to be laid off, followed by trainers and some support staff,” said Whisner. “This left managers to do much of the work.”

While the managers are happy to keep their jobs, most companies have not yet begun to hire in HR, even though there have been signs of recovery. Why should they, when they can make do with fewer people? “HR managers, many of whom are putting in 50 to 60 hours per week, are telling me they need to reclaim their lives. They’re going to their companies and asking for help,” said Whisner. “Some companies are responding –they’ve just started to hire in the HR field. That started in January.”

Looking toward the future in HR, Whisner sees more companies hiring again, but cautions it will be evolutionary, not revolutionary. “It might start with a six-month temporary assignment that will increase the contingency workforce,” said Whisner. “But we are starting to see companies come to us with a critical need to hire right away. They’re running so lean they can’t cover if they lose workers. The people they are hiring are those with multiple skill sets.”

According to Staffing Industry Analysts, Inc., which provides market research on U. S. and global staffing services, employers are turning to experienced professionals to fill temporary jobs instead of hiring traditional (and lower paid) administrative workers. The reason? Excellent skills.

“An HR professional, for example, typically has excellent clerical skills, which is attractive to an employer,” said Whisner. “We’re seeing a lot of professionals accepting interim clerical positions or going on clerical temp assignments. It’s a win-win if you’re willing to do it. You start with a temp position and then have the chance to prove yourself.”

For out-of-work HR professionals who choose not to accept temporary clerical positions, there are occasionally consulting opportunities. These can sometimes bridge the gap until a full-time position opens up.

“Companies still need their HR staff to be trained on a variety of issues, such as interviewing, performance management and sexual harassment,” said Whisner. “As a consultant, you must come in with a developed program and handouts specific to the company’s needs. But keep in mind that consulting is not consistent employment.”

On the sales end of the business, Whisner said companies are definitely hiring. Sales are revenue generators, especially business-to-business sales. “Companies with products and services are doing well in their markets and want to expand to other markets or to other parts of the country,” said Whisner. “We’re starting to see sales positions coming in volume.”

The good news here is the domino affect: more sales results in the need for more support and production personnel, including marketing staff. Whisner said when sales are strong, companies often ask the questions, “Who is buying our product, and where?” As a result, there will be opportunities for those in the marketing field as companies invest in software and in people to help with market analysis.

“Companies are looking forward in 2003, while in 2002 they were looking back,” said Whisner. “Are we back to the boom we enjoyed before? Absolutely not. It is a cautious, conservative path companies are taking.”

Companies may be conservative now, but the years ahead may change that approach. According to the Herman Trend Alert by Roger Herman and Joyce Gioia, strategic business futurists, employers have become complacent. Since turnover is so low, employers have reduced their efforts to make employees feel valued and appreciated. But as the economy improves, more jobs will be created, and many that were lost to layoffs will become available once again. In a short period of time, U.S. companies may experience serious labor shortages.

According to the U.S. Bureau of Labor Statistics, in 2010 there will be 167.7 million skilled jobs to fill, but only 157.7 million people in the workforce to fill them. The numbers boil down to a shortage of more than 10 million workers within seven years.

“Right now companies should be thinking about attraction and retention strategies,” advised Whisner. “They must invest in and keep their people, because once jobs become plentiful, workers will be able to pick and choose where they want to work.”

Until then, it is still an employer’s market. Those looking for jobs must set realistic expectations for the job market today and consider accepting positions that will demonstrate their versatility – even if it means taking on a job that does not challenge their abilities. Those who do just might find it’s their market in the near future.