Hiring is expected to remain on a steady course over the next three months, according to CareerBuilder’s latest job forecast. Twenty-six percent of employers plan to increase full-time, permanent headcount in Q2, on par with the previous two quarters, but trending below Q2 estimates last year. While the U.S. job market has been moving in a positive direction—each year in the recovery improving upon the previous one—employers are waiting to see how government spending cuts, health care reform, debt restructuring in Europe and other issues will play out before intensifying their hiring efforts.
More than 2,000 hiring managers and human resource professionals across industries and company sizes were surveyed by CareerBuilder and Harris Interactive about their plans for headcount and compensation within their company.
While employers are still sizing up the market, job creation is likely to remain stable and improving as the year goes on. When we look at listings on CareerBuilder.com, job growth isn’t confined to technology and health care and other areas that have fared well post-recession. The rebound in the housing sector is having a positive influence on job creation for related industries that have been struggling.
Hiring in the first quarter of 2013
In a previous survey completed in November 2012, 26 percent of employers planned to hire full-time, permanent employees in the first quarter of 2013. The number of employers who actually hired full-time, permanent staff was 28 percent—down from 33 percent last year—reflecting a cautious environment in the wake of slower-than-expected economic growth in Q4 2012.
Twelve percent of employers decreased headcount, up from 9 percent last year. Fifty-nine percent said there was no change in their number of full-time, permanent employees while 2 percent were unsure.
Hiring in the second quarter of 2013
Looking ahead, 26 percent of employers plan to add full-time, permanent staff in Q2, down from 30 percent last year. As we saw in Q1, employers historically have been more conservative in their estimates than their actual hiring activity, and the number may come in higher at quarter’s end.
Nine percent of hiring managers expect to downsize staff, up from 6 percent last year. Sixty percent anticipate no change while 5 percent are undecided.
Temporary labor is playing a larger role within organizations as companies look to meet increased market demands and quickly scale up their businesses. Thirty-two percent of employers plan to hire contract or temporary workers in the second quarter, slightly down from 34 percent last year.
Nearly one in four (24 percent) employers is planning to transition some contract or temporary staff into permanent employees in the second quarter, the same as last year.
Hiring by company size
Hiring in companies of all sizes, while trending below Q2 2012, will continue at a steady pace into the middle of the year. In companies with 50 or fewer employees, 17 percent plan to add full-time, permanent staff in Q2, down from 20 percent last year. Those reducing headcount increased to 6 percent in 2013 from 5 percent last year.*
In companies with 250 or fewer employees, 21 percent plan to add full-time, permanent staff in Q2, down from 22 percent last year. Those reducing headcount increased to 7 percent in 2013 from 5 percent last year.
Of companies with 500 or fewer employees, 22 percent plan to add full-time, permanent staff in Q2, down from 25 percent last year. Those reducing headcount increased to 8 percent in 2013 from 5 percent last year.
Among the largest companies—more than 500 employees—33 percent plan to add full-time, permanent staff in Q2, down from 38 percent last year. Those reducing headcount increased to 10 percent in 2013 from 7 percent last year.
While there have been notable increases in compensation for niche, high skill positions in areas such as healthcare and information technology, compensation trends in general have remained relatively flat.
Thirty-three percent anticipate no change in salary levels in the second quarter compared to the same period last year. Forty-one percent of employers expect there will be an increase of 3 percent or less. Sixteen percent expect their average changes will be between 4 and 10 percent and 2 percent of employers predict an increase of 11 percent or more.
Three percent anticipate a decrease in salaries and 5 percent of employers say their company is undecided.
*Totals may not equal 100 percent due to rounding.
Matt Ferguson is CEO of CareerBuilder.