Oct 01, 2014

DCR National Temp Wage Index - October 2014

DCR National Temp Wage Index

Far from economist forecasts of 220,000 to 230,000, the latest Bureau of Labor Statistics (BLS) job numbers show that 142,000 new jobs were created in August 2014. This was the lowest job gain for 2014, following six straight months with employment gains of over 200,000 jobs each. Nationwide unemployment decreased slightly to 6.1 percent from 6.2 percent, but the change is attributed to fewer working-age Americans participating in the labor force.

Long-Term Unemployed

Long-Term Unemployed

Source: The Wall Street Journal

Most industry sectors had low gains or actually lost jobs in August, with healthcare, construction, hospitality, and temporary jobs topping the list as the biggest gainers. The healthcare industry added 34,000 jobs, with 22,800 of those in the ambulatory services sector. Restaurants and bars added 21,500 jobs, but cuts in other sectors of the leisure and hospitality industry created a net gain of 15,000. Construction had strong growth, adding 20,000 jobs, with specialty contractors accounting for 11,500 jobs. The temporary and staffing sector added 15,400 jobs, with temp jobs accounting for 13,000.

According to the ADP national employment report, U.S. private sector employment rose by 204,000 jobs in August 2014, down from a 212,000 increase in the month before. Small businesses accounted for 78,000 jobs. In addition, Challenger Gray & Christmas reported that companies announced 40,010 layoffs in August, which is 21 percent below the number of job cuts in the year before.

The Conference Board’s recent report on online job ads stated that U.S. online job postings rose by 164,600 in August to a total of 5.2 million. The largest gains were seen in professional occupations, such as business and finance, computer and math, and healthcare.

Monthly Changes in Payroll Employment (in thousands)

Monthly Changes in Payroll Employment (in thousands

Source: BLS

Manufacturing Hiring Expected to Rise

A national employment report by the Society for Human Resource Management (SHRM) shows that hiring in the U.S. manufacturing sector is expected to increase. The report’s survey found that 50.5 percent of manufacturing companies have plans to hire in September 2014. A net of nine percent of manufacturing companies reported increasing new-hire compensation in August 2014.

Wages Still Increasing

While the August job numbers fell below economists’ expectations, they still are an addition to payrolls. Nonfarm payrolls in August were up 1.8 percent compared to August 2013.

Hourly wages for nonsupervisory workers increased 0.3 percent in August 2014, and are up 2.5 percent from a year ago. Average hourly earnings in August were $24.53, up 6 cents from the previous month and 50 cents from the year before. Over the past 12 months, average hourly earnings have risen by 2.1 percent.

Wages Climbing

Wages Climbing

Source: The Wall Street Journal

The VA’s Upcoming Hiring Spree

The U.S. Department of Veterans Affairs (VA) just recently announced plans to launch a major recruitment campaign to source doctors, nurses, and other health care professions. Additionally, the agency is planning to add jobs for support staff with a variety of roles such as clerks, chaplains, electricians, librarians, and plumbers. While the exact number of vacancies has not been released, the VA said that they had over 36,000 unfilled healthcare positions earlier in the summer of 2014.

According to industry experts, recruiting healthcare professionals is not going to be an easy task for the VA. In a highly competitive industry, the VA has had recent salary freezes and bans on bonuses, and job locations are in less desirable areas. Matt Stevenson, the executive leading workforce planner at Mercer, says that the VA needs to build a strong employee value proposition to attract job candidates. This could include appealing to patriotic duty, or highlighting unusual benefits that the department offers workers.

Healthcare industry experts say that the general recruiting cycle for a doctor is upwards of six months, meaning that the VA may turn to temporary staffing agencies to fill gaps in the short-term.

Disconnected Youth and Baby Boomers

A recent report from the Social Science Research Council reveals that one in seven young people, or about 5 million 16-24 year olds are not working and are not in school. These “disconnected youth” cost taxpayers $83.7 billion in government support and lost tax revenue. However, the unemployment rate of this generation is improving. As per the BLS, the July 2014 unemployment rate for this group was the lowest since the recession started, at 13.6 percent.

According to the Social Security Administration, more than 70 million Baby Boomers will retire by 2030 at an average rate of 10,000 Baby Boomers retiring every day. Georgetown University says that their absence in the workforce will help create over 30 million job openings by 2020.

“We need tens of thousands of new doctors, new nurses, new clinicians.” ~Robert McDonald, Veterans Affairs Secretary