The Society for Human Resource Management’s (SHRM) Leading Indicators of National Employment (LINE) Report found that January 2012 will mark the third consecutive month that hiring activity will decrease, while job cuts increase on an annual basis.
Comparing January 2012 to January 2011, service sector hiring will drop by a net of 15.4 points while manufacturing sector hiring will fall by a net of 4.4 points. Taking a closer look at the service sector, 6.1 percent of employers plan to add jobs in January 2011, compared with 21.5 percent that did in the previous year. The manufacturing drop is less severe, jumping from last year’s 26.9 percent of companies planning to hire, to this year’s 25.3 percent. The decline in openings in both sectors could be due to decreased demand, or also a result of some companies getting more production out of existing employees rather than considering new hires.
According to past-month trends, hiring is dropping while recruiting is becoming reportedly more difficult for both the service and manufacturing sector. This past December’s statistics show the highest net of recruiting difficulty in 4 years. The SHRM LINE Report shows that a net of 11.6 percent of HR professionals in manufacturing companies reported difficulty in filling key positions, marking a 2.9 percent increase from one year ago. The service sector reported slightly less difficulty, only 9.1 percent of companies reported recruiting difficulty for the month of December, yet this marked a 5.8 percent increase from one year ago. The difficulty in recruiting suggests the labor market may be suffering from structural issues and decreased demand.
To read the full LINE Report, click here.