March 2015 Employment Situation Report

While the unemployment rate remained stable for the month of March, and job growth was lower than expected, the U.S. continued to add jobs across a variety of sectors.

Workforce grows as employment situation remains stable

According to the Employment Situation released by the Bureau of Labor Statistics, the country’s unemployment rate did not change during March, remaining at a steady 5.5 percent. The overall number of people in the workforce was 8.6 million, up 126,000 from February.

Between March 2014 and March 2015 the number of employed people has increased by 1.8 million, contributing to a 1.1 percent drop in the unemployment rate. The report explained that the civilian labor force experienced little change this month, staying solid at 62.7 percent. Notably, this number has mostly stayed between 62.7 and 62.9 percent since April 2014.

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Healthcare, retail and business services expand hiring

The 126,000 new positions were spread among a variety of fields. The industry that added the most workers this month was the professional and business services sector, which grew by 40,000. Within this general field some of the areas where hiring went up included engineering services, management and technical consulting services, and computer systems design and related services. Healthcare also saw a larger workforce in March, growing by 22,000 employees. Most of these jobs pertained to ambulatory care and hospitals. Within this sector, nursing care facilities shrank by 9,000 positions. The retail industry continued its growth, adding 26,000 jobs.

One of the fields that lost positions this month was mining, which shrank by 11,000 workers. This industry added 41,000 jobs last year, but so far has lost 30,000 jobs in 2015. Many other industries, including food service, manufacturing, construction, government, financial activities, transportation and warehousing, and wholesale trade changed very little throughout March.

Wages on the rise

The report indicated that hourly earnings increased for workers this month, going up by 7 cents to equal $24.86. This number has increased by 2.1 percent over the past 12 months. The average hourly earnings of private-sector production and nonsupervisory employees increased by 4 cents to rest at $20.86.

Economists anticipated more growth

While the report is stable, economists had predicted much larger growth, explained Nasdaq. Industry experts had anticipated that the nation would add 248,000 new jobs this month, while the actual number was significantly less. The source noted the Federal Reserve acknowledges that March’s report fell flat in the face of economists’ predictions, but it is not worried that the country’s economy is declining. If numbers get back on track to improving at higher rates, the organization plans to increase interest rates.

View the full Bureau of Labor Statistics report here.

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February 2015 Employment Situation Report

The U.S. experienced a positive labor report for February as the nation continued to move toward a strong employment situation, according to the Bureau of Labor Statistics. Not only did the overall employment rate drop, but positions were added to a variety of sectors.

Unemployment rate drops
The unemployment rate decreased by .2 percent in February to 5.5 percent. Youth unemployment, a point of concern for the nation, experienced a positive shift as well, dropping by 1.7 percent to stand at 17.1 percent. The number of residents dealing with long-term unemployment remained relatively unchanged at 2.7 million. The civilian labor force participation rate also changed very little, coming in at 62.8 percent.

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Gains seen across a variety of industries
Overall, the country added a total of 295,000 jobs during February, exceeding the current average monthly gain of 266,000. Food services saw a significant hiring increase, adding 59,000 jobs. The professional and business services sector grew by 51,000 positions. Most of these new jobs were in the technical consulting services, computer systems design and architectural engineering fields.

The construction industry grew by 29,000 positions, most of them in the form of specialty trade contractors. Healthcare services added 24,000 jobs, many of them focusing on ambulatory care and hospitals. The transportation and warehousing sector expanded by 19,000 jobs, mostly couriers and messengers, while the retail industry continued its upward employment trend by adding 32,000 positions. Manufacturing also saw a notable increase of 8,000 jobs.

Industries that saw little change during the month of February include information, financial activities, wholesale trade and government. The mining sector saw a slight loss in its workforce.

Wages up slightly, Federal Reserve rates could increase
According to the report, average hourly earnings improved by 3 cents to the current average of $24.78. Despite this only slight improvement, the U.S. dollar reached its highest value in 11.5 years against a number of currencies, reported Reuters. This general positive growth could inspire the Federal Reserve to hike rates come June, explained the source. Although the Fed has kept overnight lending rates close to zero since December 2008, the strength and potential present in the labor report could be grounds for increases.

View the full Bureau of Labor Statistics report here.

First Friday Preview March 2015: What is your office space engaging?

What Office Space Says About Company Culture and Employee Engagement

Over the last few years, the image of desirable office space has changed considerably. The goal of rising through the ranks to earn a big corner office is increasingly becoming a thing of the past, as many companies shift from designated offices and cubicles to open workspaces. This transformation reflects a growing trend toward work environments that are more conducive to open communication and collaboration between team members, as well as a focus on condensing office space to reduce rental expenses.

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It is no longer acceptable to dread coming in to work every day. Top candidates expect to work hard, but they want to have fun doing it, and enjoy the people with whom they work.

The new concept of office space isn’t just taking hold at technology and marketing firms, or hip restaurants; more conservative industries such as banking and education are increasingly adopting this model. Despite all the benefits of this modern work approach, it’s not for every company, nor for every potential hire. As the improved labor market prompts more companies to hire, more attention will need to be placed on what the office environment communicates about the company culture and employee engagement, and if these messages are being communicated effectively.

Believe it or not, office space, a seemingly minor aspect of work life, is growing in importance, so much that a recent article described a candidate who left a job interview, after catching a glimpse of his/her prospective workspace. “While this may seem like a rare or unlikely occurrence, this is the reality, especially when we consider the wants and needs of a growing Millennial population,” says Suzanne Rice, director of U.S. Franchise Development. “This generation of workers, which the U.S. Bureau of Labor Statistics projects will make up 75 percent of the 2030 workforce, wants to immediately get a sense of the office energy, and most importantly, what the company culture says about how they will be treated once hired.”

Baby Boomer executives are not immune to these changes. In many companies that prefer an open office environment, the C-Suite is also finding it must deal with smaller work spaces, if not complete elimination of designated office space altogether.

Ultimately, with retention and employee engagement being some of the biggest challenges facing employers today, office space is just a part of the message that organizations can communicate about company culture. Amenities, company-funded perks and team interaction, both inside and outside the office are additional features that have the ability to tell a story about the cultural health of the organization.

It is no longer acceptable to dread coming in to work every day. Top candidates expect to work hard, but they want to have fun doing it, and enjoy the people with whom they work. “When employers include employees in the development and maintenance of the company culture, this creates a real opportunity for them to connect with workers, making it clear that they want them to be active participants in shaping the future of the organization,” adds Rice. “This is where true employee engagement starts, by interfacing with employees, facilitating ongoing, two-way dialogues and communicating this value in the marketplace. Further, this is what can make all the difference to top performers who have multiple job offers, and are faced with deciding whether to join or stay with a company.”

MRI Employment Summary for January 2015

Employment Summary for
January 2015

January’s labor situation for the U.S. was more than just a single piece of good news, according to Bloomberg Business. The source said it marks a sea change in the labor market in which the middle class and working class are finally starting to get ahead. The unemployment rate increased slightly, but gains were still made across a variety of industries. Overall, economists noted that January’s numbers show impressive economic strength.

Unemployment rate rises slightly, but labor participation improves

A total of 257,000 jobs were added and the unemployment figure for the start of 2015 came in at 5.7 percent, a .1 percent increase from December’s rate of 5.6 percent. During January, the nation’s overall workforce grew by 703,000 people. This prompted labor force participation to increase slightly, from 62.7 percent to 62.9 percent.

Industries experiencing gains

Although the unemployment rate remained largely unchanged,  a number of sectors saw their payrolls rise. The retail industry saw the most growth, adding 46,000 positions. Within this sector, sporting goods, hobby, book, and music stores added the most jobs, although motor vehicle and parts dealers and non-store retailers also experienced notable growth.

The construction sector grew by 39,000 jobs, with gains in both residential and nonresidential building. Within the sector, specialty trade contractors employment trended up, added 13,000 jobs.

The healthcare sector, which has been steadily expanding for months, added 38,000 more jobs during the month of January. The majority of these positions came from doctors’ offices and hospitals, although gains were also seen in nursing and residential care facilities. Financial activities employed an additional 26,000 workers this past month, while the manufacturing industry grew by 22,000.

Other industries that experienced job creation were professional and technical services, which added 33,000 workers, and food services and drinking places which added 35,000 jobs.

Wages on the rise

Compensation rates increased in January, following a notable decline in December. While the end of 2014 saw a decrease of 5 cents, January’s average hourly wage went up by 12 cents, coming to $24.75. Average hourly earnings for private-sector production and nonsupervisory employees went up by 7 cents and currently rests at $20.80.

Fortune magazine noted that these much-welcome wage increases have been anticipated by economists. As compensation rates climb, it is more likely that the Federal Reserve will raise interest rates.

Numbers exceed economists’ expectations

Bloomberg reported that January’s report impressed economists, who had predicted  an increase of 228,000 jobs. While the unemployment rate climbed slightly, the source noted that it was likely due to the increasingly positive labor situation in the U.S., which has inspired more people to return to the workforce.

The source explained that inflation rates have been kept low due to increasingly weak overseas economies. Inflation is expected to continue to go down as 2015 continues, and industry professionals anticipate that the U.S. will soon have an unemployment rate as low as 5.4 percent.

The full Bureau of Labor Statistics report can be downloaded here.

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First Friday Preview: Job Market and Career Insights from MRI Network

The Importance of Career-pathing and Mentoring in 2015

2014 came to a strong close, with U.S. employment reaching a 12-month average of 246,000 new jobs and unemployment dropping to 5.6 percent. Confidence is growing in the labor market and as a result, many companies plan to hire throughout 2015. With all of this positive news on the job front, employees might have expected to see upward movement on salaries and wages. However, most recent surveys and reports indicate employers are planning modest pay increases, comparable to what was awarded in 2014. In light of this, how will companies retain their best talent, when below-market salaries are one of the top reasons employees decide to leave?

According to Towers Watson commentary regarding their 2014 compensation survey, the projected 3 percent pay raise in 2015 is a bit disappointing as the average employee is barely keeping ahead of inflation. However, we realize that many companies are being conservative with pay, because they are still concerned about the stability of the economy and the labor market.

Despite this reality, the most recent MRINetwork Recruiter Sentiment Study, found that although improved compensation and benefits are a leading factor for candidates considering changing jobs, the top reason that candidates leave is because of clear advancement opportunities elsewhere.


So what does this mean for employers?

Companies may be at greater risk of losing their top performers, but the wage issue can be averted by focusing on career tracking, mentoring and training programs.  After all, advancement to a more senior role not only connotes greater responsibility, but also higher pay, or at least the long-term potential to earn more.

“The days of requiring employees to take on the workload of people who either resigned or were laid off, without additional pay, are behind us,” says Nancy Halverson, vice president of global operations for MRINetwork. “Today’s workers want recognition for their contributions, and they expect to see a clear path for how added responsibilities will enable them to advance within the company.”

Ultimately the salary discussion has more to do with an employer’s culture of coaching, mentoring, training, recognition and evidence of upward mobility, in addition to how well the organization communicates and sells these attributes, both internally and externally. “The goal should be more about creating a ‘best place to work’ environment that is highly desired by candidates in the marketplace,” adds Halverson. “This is really what the future of recruitment and retention is all about.”

Advancement opportunities and career-pathing will additionally become more important as Baby Boomers retire and Millennials become the majority in the workplace. This generation is especially focused on gaining experience that can be leveraged to make the next career step, which is why job changes after 2-3 years are more common. Companies that provide the mentoring and training that Millennials crave are not only working toward retention of their brightest talent, they are grooming the future leaders of the organization.

Halverson provides the following tips for establishing and promoting career-pathing and mentorship programs:

  • Brainstorm how your organization can develop these programs, if they don’t already exist. Consider how they can be leveraged to support various groups within your workforce including minorities, women and junior to mid-level management candidates.
  • Begin discussing internal mobility programs during the interviewing and onboarding process.
  • Promote the programs through multiple internal and external channels to create stories about employee advancement within the company.

Although career growth is what’s most important to candidates, it doesn’t mean that companies can make wage increases a last thought. Salaries are going to have to come up to attract top performers. “However, no amount of money will make them stay in a role that appears to have no future,” concludes Halverson. “That’s where the power of career-pathing kicks in.”

Is it worth it to invest in recruiters?

What is the most common ‘nay’ a recruiter hears when reaching out to new clients?… 

“It is cheaper for us to do our recruiting internally.”

In these situations, it is usually a Human Resources manager paired with the team or department lead that are in charge of finding and placing talent from start to finish. This is a huge undertaking considering that the HR manager is also in charge of managing compensation and benefits, managing federal HR compliance and audits, mediating employee complaints and performance reviews, among a plethora of other things that can pop up at any given moment. 

The hiring process also takes valuable time away from the hiring manager and their specific projects and objectives. This person may not have experience or interest in the hiring process and view it as a poor use of their time.

On the surface, this arrangement makes sense. However, is it really logical to think that someone that is always on call to deal with conflict, sensitive information, and employees’ questions paired with another that is inundated with their own department’s deadlines and projects have the time to find the very best candidates for your company?

Consider the hard, non-refundable costs of doing all of your recruiting internally:

Say you are hiring a Director of  Marketing ($165,000), and you are recruiting internally. It is safe to assume that the key players will, at the very least, be the HR Manager (median salary of $90,000 or $43.27/hr) and the VP of Marketing ($220,000/year or $105.77/hr).

We will combine the hourly rates for the Director of Marketing and the HR Manager to find the estimated cost of hiring internally, starting our search with 15 resumes:

Writing job spec for job postings– 2.5 hours $372.60

Speaking to job boards and posting adverts – 3 hours $447.12

Fielding calls from recruiters & applicants – 6 hours $894.24

Reviewing CV’s – 8 hours $1,192.32

Telephone Interviews (30 mins x 15 interviews) – 7.5 hours $1117.80

Face to face interviews (1 hr x 10 interviews) – 20 hours $2,980.80

2nd Interviews (1 hr x 5 interviews) – 5 hours $745.20

Subsequent meetings about the interviews – 4 hours $596.16

Making offers (emails / calls / paperwork) – 1 hour $149.04

Total – 57 hours

Cost of job postings (CareerBuilder/Monster) – ~$400 for each posting @ 2 postings

Grand total – $8.895.28

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These are only the hard costs. What soft cost may also be leaking valuable time and dollars?

1. Your job search may take longer to fill and cause continued stress to current employees.

What is the cost of having this position open? How much stress is the rest of the team absorbing by picking up the slack? Depending on the nature of the position, you may be starting from square one or close to it. Recruiters have a built in network, and are masters of recruiting passive talent. 

2. You may not have access to the best fit the first go round.

When you are limited on time and resources, it makes sense to search for resumes through job boards and direct postings. However, research shows that some of the best candidates are passive candidates. It is the recruiters job to constantly build her network and stay in touch with talent that are not actively posting their resume or applying to job board postings. Your job posting may have all of the right keywords, but the best candidates may not be searching for them at all.

3. Adopting a ‘no recruiters’ policy leaves no safety cushion.

Despite careful screening and multiple interviews, sometimes an employee is simply not the right fit. It probably has nothing to do with their skills and their ability to do the work. Perhaps it is a personality clash with team members, or they do not connect with the company culture.

First of all, it is the recruiters top priority to get to know your organization and culture and to ask the right questions to candidates before they are presented to you. Candidates are offered and accept jobs because of their skills; they leave them because of culture or fit.

Secondly, a recruiter’s fee (typically 25%-30% of the candidate’s compensation), may seem more expensive in the short term, but rarely ends up costing more in the long term. Recruiters’ networks have been built over years of industry experience and are always expanding. We only present our clients with the very best candidates. 

Finally, If for some reason you find the candidate we place is not the best fit, the recruiter will replace the candidate at no cost. If your internal team has to go back to square one, you are looking at almost $18,000 for round two and even more time where your current employees are overworked, disengaged, and becoming less and less productive.

Are you ready to start thinking strategically about your hiring practices and to invest in the long term?