Wednesday, November 5, 2008

Job Market Update

The doom and gloom on the street and in the news with unstable capital markets has all employers looking at their hiring practices more carefully. The slow down started about 10 to 12 months ago with a gradual decreased in new job starts. Over the past month we have seen a sharp decrease in new jobs (roughly 30% drop from a year ago) as everyone is concerned about the recession. A year ago there were multiple opportunities (3 to 4 interviews in a week) to active candidates, today the same candidate may have one interview. There are exceptions to all of this but in general tougher times are here.

We see critical hires being made along with replacements to key positions that have been recently vacated. Only a few companies are growing and adding head count. Most are sitting back and waiting for a more predictable economy that will reduce the risk of over hiring and spending.

As 2008 comes to a close we predict a significant decline in newly created jobs between now through the end of the year. We do not see any significant growth in the early part of 2009 unless the following takes place.

1. Better than expected holiday season and better than expected Q4 corporate earnings resulting in more confidence that the worst may be over.
2. With better than expected results in Q4 a change in the volatility in the capital markets will need to take place if it hasn't already.
3. Companies who have been able to stay profitable will need to have the confidence that business will continue to do well and the investment in human capital will not result in layoffs 6 to 9 months down the road.

Companies will be conservative, there will not be great demand for talent all at one time but a slow and steady increase of jobs should take place from the February/March time frame if all goes well.

If you are looking for change now, you better work hard at it, once Thanksgiving is here there will likely be very few new jobs available through the end of January. If you are looking for career growth please be patient, your ideal job may present itself but if it doesn't in the near term you will likely see more options at the end of Q1 next year.

For the hiring managers or employers thinking that there is a flood of candidates on the market with ideal profiles think again. Employed candidates are cautious and only willing to change if the job really helps their career growth and move to a company that appears to be in very good financial condition. Candidates who may be part of a reduction in work force may be motivated but may not have all the skills you require. There is nothing wrong with developing people if they have the talent and satisfy most of the technical requirements for your opening. You could be better off bringing in a motivated person who will be up to speed before your ideal candidate becomes available.

Happy Hunting!

Bryon McDougall