Though many job seekers and businesses would like to see more immediate signs of economic improvement, a new CareerBuilder survey finds evidence for progress through slower, steadier growth in hiring plans that will provide lasting change.
The U.S. jobs outlook for the second quarter of 2014 (April-June) closely follows last year’s forecast, but several large industries are expected to outperform the national average for hiring, indicating where the country’s economic future is heading. The number of manufacturing employers that plan to add full-time, permanent headcount increased three percentage points over Q2 2013 and beat the national average for this year’s forecast by seven percentage points. Other industries that are projected to lead in job creation include information technology, financial services, professional and business services and health care.
In addition, there are more good signs: a recovering housing market, growing economy, rising consumer confidence and companies that are starting to tap into cash reserves to invest. As these trends strengthen, hiring can be expected to hold steady in the second quarter and gain ground in the back half of the year.
Five industries to watch
Forecasting the hiring needs of employers in Q2, hiring managers may stay on par with last year, as 26 percent of employers plan to add full-time, permanent staff. However, given that employers historically have been more conservative in estimates than actual hiring activity, the number may come in higher at quarter’s end.
Eight percent of employers expect to downsize staff, down from nine percent last year. Sixty-one percent anticipate no change while five percent are undecided.
The top five industries that are expected to surpass the national average for adding full-time, permanent staff in the second quarter include:
- Information technology – 34 percent of hiring managers
- Financial services – 34 percent
- Manufacturing – 33 percent
- Health care* – 28 percent
- Professional and business services – 28 percent
A shift in company budgets and preference for flexible work schedules has led to a rise in hiring temporary or contract workers, as temporary employment shows a slight improvement over last year’s projections. Thirty-three percent of employers plan to hire temporary or contract workers in the second quarter, up from 32 percent in 2013.
This can be good news for job seekers: 26 percent are planning to transition some contract or temporary staff into permanent employees in the second quarter, up from 24 percent last year.
While businesses and specific industries show promising signs of growth in Q2, plans for adding headcount while maintaining financial progress may affect the ability of employers to increase compensation this quarter.
Thirty-one percent of employers anticipate no change in salary levels in the second quarter compared to the same period last year. Forty-one percent expect there will be an increase of 3 percent or less. Nineteen percent expect their average changes will be between 4 and 10 percent and two percent predict an increase of 11 percent or more. Three percent anticipate a decline in salaries and 5 percent are undecided.
Hiring by company size
The size of a business can affect their plans for growth, as seen in the hiring plans for varying company sizes. Hiring among small businesses is also expected to grow marginally compared to the second quarter last year:
- 50 or fewer employees – 18 percent plan to add full-time, permanent staff in Q2, up from 17 percent last year;
- 250 or fewer employees – 22 percent plan to add full-time, permanent staff in Q2, up from 21 percent last year;
- 500 or fewer employees – 23 percent plan to add full-time, permanent staff in Q2, up from 22 percent last year;
- More than 500 employees – 32 percent plan to add full-time, permanent staff in Q2, down from 33 percent last year;
*Health care organizations with 50 or more employees