The tempered plans for Q4 follow a slightly softer recruitment picture in Q3. In terms of actual hiring, 26% of employers reported they added full-time, permanent headcount in Q3. While better than the same period in 2010, this is down three percentage points from Q2 2011—reflecting a more hesitant hiring environment in the face of rising commodity prices, a volatile stock market, concerns over Europe’s sovereign debt crisis and other global issues.
“While hiring is historically slower in the fourth quarter, recent world events and a structurally impaired U.S. economy are causing employers to be a little more guarded,” said Matt Ferguson, CEO of CareerBuilder. “Job creation levels are not yet high enough to drive down the unemployment rate, but the hiring trends we’ve seen through our surveys and on our job site still indicate an overall positive sentiment among employers. For eight consecutive quarters, 20% or more of employers reported adding new jobs and the same is expected for Q4.”
When looking for talent, companies are still having a difficult time filling certain positions despite the stiff competition for jobs. Two-thirds of employers (67%) expressed concern over the education and skills gap in the U.S. and corresponding deficit in talent for specialized positions. The top areas employers identified as having a significant skills gap include engineering (37%) and information technology (33%).
More than one-in-four hiring managers (26%) reported they hired full-time, permanent staff in the third quarter, up slightly from 25% last year, but down from 29% in Q2. While staff reductions slightly improved year-over-year—11%reporting a decrease in headcount in Q3 2011 compared to 12% in 2010—it was unchanged sequentially. Sixty-two percent of employers reported their staff levels stayed the same in Q3 while 1% were unsure.
Looking forward, 21% of employers expect to increase their number of full-time, permanent employees in Q4. Ten percent expect to downsize staffs, while 64% anticipate no change and 5% are undecided.
To supplement staffs, 32% of employers turned to temporary help in Q3. Twenty-seven percent plan to hire temporary or contract workers in Q4 with 17% of employers expecting to transition some of these employees into permanent staff.
Regional data presents a mixed picture. While the West leads the U.S. regions in the number of employers expecting to hire full-time, permanent employees in Q4 (23%), it also houses the highest number of companies planning to downsize by year end (12%).
Twenty-one percent of employers in the Midwest and South and 19% in the Northeast plan to add staff in Q4. Ten percent of employers in the Northeast and 9% in the Midwest and South expect to decrease headcount.
Comparing company sizes, small businesses continue to lag larger organizations in hiring activity, but are also less likely to reduce staff levels.
• Companies with 500 or fewer employees – 17% plan to increase full-time, permanent headcount in Q4; 8% expect to reduce staff levels. Of those with 50 or fewer employees, 12% plan to add new employees while 8% expect to reduce staff levels.
• Companies with more than 500 employees – 27% plan to hire full-time, permanent staff in Q4; 11% plan to decrease headcount.
Forty-one percent of employers anticipate no change in salary levels in the fourth quarter compared to the same period last year. Thirty-eight percent expect there will be an increase of 3% or less. Twelve percent expect their average changes will be between 4 and 10% and 1% predict an increase of 11% or more. Four percent anticipate a decrease in salaries.
More than 2,600 hiring managers and human resource professionals were interviewed for this survey, which was conducted by Harris Interactive from August 16 to September 8, 2011. The entire report can be downloaded at: http://bit.ly/pvZyd4.