PeopleScout Australia Jobs Report Analysis – December 2018

Australia’s unemployment rate fell in December to 5.0%, beating analyst expectations that it would remain at November’s 5.1% level. Unemployment is now at its lowest level since June 2011. The job gains were due to an increase in part-time employment which rose by 24,600, offsetting a decline of 3,000 full-time workers. Despite the tight job market, wage growth remains sluggish.

Australia Jobs Report Analysis – December 2018

Numbers

21,600: The Australian economy added 21,600 jobs in December.

5.0%: The Australian unemployment decreased to 5.0%.

65.6%: Labour force participation fell to 65.6%.

+3: The next index will be reported on January 28. Therefore, the latest index is the December release which showed that according to the NAB, the business confidence index fell to +3 index points.

Upside

According to the December Labour Force figures released by the Australian Bureau of Statistics (ABS), employment increased by 21,600 in seasonally adjusted terms. Total employment now stands at 12.714 million, the highest level on record. Since December 2017, full-time employment has increased by 162,000 while part-time employment increased by 106,600.

Australia’s unemployment rate fell in December to 5.0%, beating analyst expectations that it would remain at November’s 5.1% level. Unemployment is now at its lowest level since June 2011. In seasonally adjusted terms, the largest increase in employment was in Queensland (up 11,600 persons), followed by Victoria (up 10,500 persons) and New South Wales (up 3,800 persons).

Many economists greeted 2018’s final report with reserved satisfaction. Westpac’s Justin Smirk wrote:

“Employment ended 2018 with a sound run. In the year to December total employment grew 268,600, or 2.2%, which matches the six month annualised pace of 2.2%. While it is true that the momentum in the Australian labour market eased through 2018 — annual growth peaked at 3.6% in January — it can still be described as sound.”

Downside

The job gains were due to an increase in part-time employment which rose by 24,600, offsetting a decline of 3,000 full-time workers. December was the second month in a row that full-time employment fell. The slow rate of full-time job growth is a cause for concern as the Sydney Morning Herald noted:

“There are some signs of a slowdown with the total number of full-time jobs created in the past 12 months down more than 40% on the record-breaking performance of 2017. For the second consecutive month, full-time employment edged down nationally while the under-utilisation rate also remained elevated at 13.3%.”

The under-utilisation rate includes both those who are unemployed and those who are under-employed. The labour force participation rate fell by one-tenth of a percentage point, reversing last month’s increase.

Unknown

Despite a healthy job market, wage growth in Australia remains frustratingly low. As Your Money contributor David Ross writes:

“Unemployment hasn’t been this low since 2012…Meanwhile, jobs vacancies are up 13.6 per cent on last year at 6.5 year highs, and business profits are up 13.2 per cent in 2018’s September Quarter on 2017’s. These are healthy statistics for the Australian economy. But for another key metric – wage growth – it has been a different story. Indeed, those Australians who were lucky enough to receive a pay rise last year likely saw one which fell flat in the face of those handed out in the years of the mining boom, when Australian wages went up as much as 1 to 2 per cent year on year, accounting for inflation.

‘Don’t believe we’re living through a Golden Age in the economy,’ University of Sydney Business School Professor John Buchanan told YourMoney.com.au. ‘The labour market has seen a significant deterioration for many people, It’s just becoming clearer for more people to see. It’s been something coming for quite some time.’

Figures released by job-seeking website Indeed show that every industry is now recording wage growth in the past year below their decade average. And that’s despite the number of open and unfilled job listings growing. So the big question for many is: where’s my pay rise?”

Flexibility in the Workplace: Rethinking Work


Checking the status of an important project while waiting to catch a flight. Replying to a coworker’s email from the comfort of your favorite café. Shifting your hours to make time to take an aging parent to a doctor’s visit. Each of these scenarios has one thing in common – they are made possible through flexibility in the workplace.


Flexible work arrangements are surging in popularity. In the U.S., 94 percent of employers provide some form of flexible work arrangement according to a survey conducted by the International Foundation of Employee Benefit Plans. A survey conducted by Regus revealed that some 54 percent of global respondents now report that they work remotely 2.5 days a week or more.


You may be wondering: What’s behind the surge in popularity for flexible workplaces? Well, the data speaks for itself. Global Workplace Analytics found the following:

  • AT&T found that its remote workers worked five more hours than its office workers.
  • Compaq’s flexible workforce increased productivity between 15 and 45 percent.
  • American Express’ flexible workforce had a 43 percent higher productivity level than their traditional counterparts.

In this article, we’ll cover what workplace flexibility means, why you should consider bringing more flexibility to your workplace and how you can best manage the challenges and opportunities presented by a flexible workforce.

So, What Does Workplace Flexibility Mean and Why Should I Care?

Workplace flexibility is an alternative to traditional workplace models that dictate when and where workers perform their work. Workplace flexibility permits employees to choose when, where and how they work.


Flexibility in the workplace shouldn’t be seen as just a perk you offer to employees; it should be viewed as a critical part of your organization’s talent acquisition strategy – and as a fundamental way to increase productivity.

Greater Employee Flexibility: How Employers Benefit With More Flexibility in the Workplace

Employee Flexibility
A Broader Talent Pool


When your workplace culture allows talent to work from anywhere, your talent pool instantly becomes global. Your organization can source and recruit talent across the country or across the globe. With the rise of communication tools such as Skype and Slack, secure intranets and video conferencing, distance is becoming less of a hurdle to collaborating with talent globally.

What’s more, the COVID-19 pandemic has laid bare the necessity for more employee flexibility. In fact, according to a survey from Gallop, “three in five U.S. workers who have been doing their jobs from home during the coronavirus pandemic would prefer to continue to work remotely as much as possible.”

Broadly speaking, organizations that maintain this new level of flexibility will likely fare much better when it comes to recruitment and retention efforts, and overall employee engagement, especially when compared to similar organizations that decide to go back to the old way of operating with less employee flexibility.


Improved Employer Branding


According to LinkedIn’s 2017 Global Recruiting Trends, 80 percent of talent leaders agree that employer brand has a significant impact on their ability to hire great talent. Offering flexible workplace policies communicates to potential employees that your organization is committed to helping its employees achieve a better work-life balance, which in turn can help improve jobseekers’ perception of you as an employer as you provide flexibility in the workplace.


Cost-Savings and Employee Flexibility


The most prosaic benefit to flexibility in the workplace is cost savings. Costs on business necessities such as office supplies, real estate and utilities are reduced when your organization provides employees the ability to work off-site.

How Employees Benefit With More Flexibility in the Workplace

Meet Personal Obligations


Employees have a variety of personal obligations and family responsibilities. If you provide them with a flexible workplace, they can make that important parent-teacher conference during the day, go back to school or simply be home when the engineer comes to fix the dishwasher all without having to neglect work in favor of personal responsibilities. If you trust people to get their work done in a way that works for them, that trust is usually rewarded.


Employee Empowerment
flexibility in the workplace


Flexible workplaces can give employees an increased feeling of personal control over their schedule and work environment. By allowing employees to set their own style for delivery, you appeal to the entrepreneurial spirit—which can be good for your employees’ sense of self-determination.


Reduced Commuting Time and Costs


For some employees, commutes of more than an hour each way are not uncommon. If employees are allowed to work from home that can potentially save them fourteen hours of time, untold money in fuel costs and wear and tear on the road – not to mention the effect on well-being.

Types of Flexibility in the Workplace

Job Sharing


Job sharing is when two employees share the same role. Job sharing can be very appealing for your employees who may not want to work full-time, for example after having a child or with elderly relatives in need of care.


In a job share arrangement, one role gains two brains – two people with passion and creativity who are committed to success.
There are a number of ways employees in a job-sharing arrangement can manage their responsibilities. Some employees sharing a role may segment the work by each taking responsibility for specific deliverables and tasks charged to them.


Others may split the same workload, with one employee working on projects and passing along their work to their job share partner while they are off the clock. The model you and your employees choose will depend on the nature of the work performed and what preferences and skills each employee possess.


At PeopleScout’s EMEA headquarters in London, we had the luxury of employing two wonderfully talented women in our Head of Assessment role. This role wasn’t initially designed to be a job share. However, after our incumbent in the role wanted to reduce their time in-office after becoming a mom, another talented colleague stepped up to support the team.

workplace flexibility


As both women began building their families and took on the challenges of motherhood, their ability to provide 100 percent to the role was never compromised, as when one needed to take a step back the other is always there to pick up where they left off.


By providing the flexibility our employees needed to share this role, we retained two of our brightest minds. And more importantly, we let our employees know that you should never have to choose between being a parent and being a professional, you can do both equally well with the right support.


Remote Work and the Flexible Workforce


Remote work is when an employee works primarily from home or an off-site location. A well-planned remote work program can help your organization increase overall productivity and promote greater job satisfaction among your teams and may even help you in improving your employee retention efforts.


For PeopleScout in London, we did not always see remote work as an employee perk, rather we viewed it as a practical decision to reduce office expenses at our London location. We began our intrepid adventure into remote work by hot-desking—the practice of multiple workers using a single work station—our client services team.


What began as a decision borne of necessity quickly paid unexpected dividends. When our client service team members didn’t feel the need to stay affixed to their desks, something marvelous happened, they became more engaged with clients .


We were not entirely sure what to expect when we initially opened up our organization to become more flexible. However, after witnessing the success of our remote work program one thing was clear: flexibility was a business asset, not a hindrance to productivity.


Flexible Scheduling 
flexible workforce


Flexible scheduling allows an employee to work hours that differ from the traditional company start and stop time.


According to data compiled by The Economist, working fewer hours correlates with higher levels of productivity. Nations like Greece average 2,000 work hours a year, while nations like Germany average around 1,400, but yield 70 percent more productivity at work. This suggests that fixed schedules and mandatory hours may not be the key to getting the most out of your employees.


Typically, a flexible schedule involves either a compressed work week or flexible starting and stopping times. In a compressed work week, the most common schedule is a four-day work week where employees work four ten-hour days—variations on this schedule could include three twelve-hour work days, etc. This scheduling flexibility allows employees to have an additional day or two to relax, spend with family and friends or pursue activities and causes that interest them.


At PeopleScout UK, we encourage our colleagues to take full advantage of our flexible scheduling options. For example, we had a colleague who wanted to leave work a half hour early once a week to attend choir practice. We not only supported them by allowing them to flex the hours, but we also couldn’t help wondering if they’d like to invite their co-workers to their performance. As it turns out they were happy to have some new people for the audience, and many members of their team showed up to cheer them on.


By promoting and supporting our colleagues interests and encouraging others to do the same, we are communicating that we see our workers as whole persons and that their personal achievements are just as important to everyone at PeopleScout UK as their professional ones.


When your employees feel you appreciate them for more than what they can contribute to your bottom line, that you appreciate what they contribute to their community as a whole, you help engender a familial office atmosphere where employees feel both empowered and respected.

Managing Flexibility in the Workplace

Stay in Compliance


Before your organization begins offering your employees flexible work opportunities, you need to make sure your program won’t become a legal headache. Issues to consider include workers’ compensation and state/national overtime regulations, as well as matters of individual responsibility for company property used off-site. Your organization’s legal counsel should review any flexible work program proposals to make sure you stay in compliance with your country’s employment laws and the regions your organization operates in to ensure you can provide the flexibility in the workplace you to your employees.


Stay Connected


It is extremely important to stay connected with employees in flexible work arrangements. Make sure that your managers and in-office employees remember to include remote employees and support them to feel like they’re part of the team. While conference calls and email chains are effective means of communicating with remote workers, nothing substitutes being in the same room. Leverage videoconferencing technology such as Skype or FaceTime to bring more of a face-to-face feel for remote employees in important meetings.


Be Fair


A major key to managing a successful flexible workplace is ensuring that employees who opt for more traditional work arrangements are treated as equitably as their non-traditional co-workers. When you treat your all employees fairly, they feel respected, cared for and may develop a stronger sense of trust in your organization. Make sure to monitor your flexible workplace policy and periodically tweak it to address new or unforeseen inconsistencies in the treatment of workers both in traditional and non-traditional work arrangements.

The Flexible Workforce and You

flexible working examples

To reap the benefits of flexibility in the workplace, you need to continuously evaluate your flexible work program and monitor which employees use it, how the program is being used and take note of any challenges participants and managers are experiencing.


You should routinely speak with both participating employees and managers regarding if your program is working as intended, how it can be improved and what their individual experiences are while using the program. Assess their satisfaction with the program and tweak it as necessary.

How to Improve Flexibility in the Workplace:

To attract the top candidates, your company should create policies that provide the types of flexibility today’s employees seek. Here, we offer quick tips on how you can better meet the demand for a more flexible workforce:

  • Align incentives with outcomes. Instead of replacing face-time requirements with hours logged in on a virtual private network, which employees could perceive as inauthentic, you should simply set goals and deadlines. If employees meet them, their bosses can worry less about when they clock in and out.
  • Eliminate flexibility stigmas. Change your organizations culture as needed so no one is looked down on for taking advantage of flexibility options. This change needs to start at the top. Company leaders need to be transparent and lead by example.
  • Start small. Don’t try to transition your company culture to total flexibility overnight. Instead, take baby steps by allowing some employees to shift schedules or designate remote working days.


Remember, as employers, we hire whole people. We need to take them as a package: both the things that directly benefit our organizations and the things we may need to accommodate for them. This can best be achieved by providing workplace flexibility.
 

PeopleScout UK Jobs Report Analysis — January 2019

As 2018 drew nearer to a close and uncertainty over Brexit threatened to topple the stability of the government and political clashes intensified, the jobs market in the UK simply shrugged and continued to post record numbers.

January’s report published by the Office for National Statistics and includes the following details on the three months covering September through November 2018:

  • Wages continued to rise at their highest level in a decade.
  • The number of people working in the UK rose by 141,000 to 32.53 million. That is the highest figure since records began in 1971.
  • The unemployment rate was 4.0%, its lowest since the quarter spanning December 1974 to February 1975, well before most of those in today’s UK workforce were born.
  • There were 328,000 more people working in the UK than a year earlier.
UK Jobs Report Analysis — January 2019

Surprise at a Robust Report

Given the uncertainty surrounding Brexit, some economists were anticipating a report that signaled a slowing down of the jobs market, so the good news in January’s report came as a pleasant surprise. As a BBC economic correspondent noted:

“At first blush the most surprising thing about the jobs market as portrayed by the latest figures from the Office for National Statistics is how robust it is. All this talk of Brexit uncertainty and yet employers continued to take people on. The number in work and the proportion in work continued to hit a new record – as it has done now, more or less continuously, for years. And the bulk of the new jobs were full-time; there are now a record 24 million full-time jobs in the UK.

Is the jobs market simply ignoring all the Brexit-induced political chaos? Does this confirm suspicions that warnings of slower growth owing to the prospect of a no-deal Brexit was merely Project Fear? The answer to the latter question is ‘no,’ and to the former ‘we don’t know yet.’

The key is that jobs figures trail the rest of the economy. Firms that took people on in the September to November period will have decided to do so in the summer, when confidence was higher and the politics less fraught. So we will still have to wait a few months to know if Brexit uncertainty has hit the jobs market or not.”

Job Vacancies and Skill Shortages: UK Employers Ramp Up Hiring Plans

The number of job vacancies rose by 10,000 to a record high of 853,000. The Financial Times reports that most UK employers plan on expanding their headcount this year due to concern over the shortage of skills by those who could fill these vacancies:

“Skills shortages have prompted UK business leaders to ramp up their hiring plans, a survey has revealed, at a time when employers face mounting pressure over a tightening labour market. About 61% of British executives, as opposed to 53% of global leaders, expect to increase their company headcount this year, according to an annual PwC report, which includes responses from 1,378 chief executives globally and 220 from the UK. A year ago just over half of UK chiefs planned to increase staff numbers.

PwC’s CEO report comes as UK data on Tuesday revealed that real wages in the three months to November rose at their fastest rate in two years, driven in large part by a tight labour market. Unemployment fell to 4% over the three-month period, according to the Office for National Statistics, the lowest since the winter of 1974, resulting in higher wages but making life harder for companies seeking to hire, with labour shortages opening up in some parts of the country. Almost eight out of 10 UK chief executives marked a shortage of skills as their top fear, down from 83% a year ago. The leaders were increasingly pessimistic about their ability to increase revenue in the year ahead, according to PwC’s Monday report.”

“I hope it will last”

With the UK scheduled to leave the European Union in March, there is still no clear plan of what Brexit will look like. Despite all the tension and uncertainty, the jobs market continues to gain momentum. As Oscar Wilde wrote: “This suspense is terrible, I hope it will last.”

2018 Q4 Global Economic Snapshot

Strong job growth continued in the final quarter of 2018 for many of the world’s leading economies. While some countries had notable wage increases, this was not the case for all economies. Tight labor markets continued to present a challenge for employers in their attempt to attract and retain talent with high levels of job openings and low unemployment.

Strong Job Markets Across Most Leading Economies

In the United States, the fourth quarter ended with an unemployment rate of just 3.9% with the increase over previous months caused by more Americans joining the labor force. The December 2018 jobs report showed that 312,000 jobs were added in the final month of the year and the reaction from some economists was nothing short of jubilation. As the New York Times reported, “Economists offered raves that could appear on a movie poster or a book jacket — “Extraordinary!” “Blowout,” “Wow!”

Other major economies including the UK, China, Japan and Germany all posted unemployment rates of less than 5% during the quarter, as did smaller economies like Poland and New Zealand. Unemployment in Australia and Canada remained at or near historic lows. In contrast, unemployment in India rose to a 27 month high of 7.38% in December when a decrease in the labor force was also reported. The Eurozone seasonally-adjusted unemployment rate was 7.9% in November 2018, the lowest rate recorded in the region since October 2008. Unemployment rates in Southern Europe continued to be comparatively high, especially in youth unemployment. The youth unemployment rate was over 30% in Spain, Italy and Greece during the quarter.

Healthy Wage Growth for Some, Slowing Growth for Others

The United States ended the year posting an annual wage increase of 3.2%, well ahead of the rate of inflation. While wage statistics have yet to be reported for all of Q4 in the UK, the quarter started with basic wage growth accelerating to a 10 year high at 3.3%. Wage increases in the UK were especially noteworthy since inflation fell to its lowest level in nearly two years at the end of 2018. Wage data for Q4 has yet to be released for Australia, but it entered the quarter having posted the highest rate of wage increases in three years. The rise in wages in these economies comes as no surprise since low unemployment often leads to higher salaries because employers have to compete for decreased pools of available talent.

This economic paradigm did not hold for all economies. In Canada, wage growth decelerated during the fourth quarter. Commenting on the final Canadian jobs report of 2018, Global News noted:

“But even in a tightened job market the latest labour force survey shows wage growth delivered another weak reading in December of 1.49% — which is well below inflation. Year-over-year average hourly wage growth for permanent employees was 1.46% in November – and it has decelerated steadily since its May peak of 3.9%.”

Completing a Year of Growth and Uncertainty

While economic growth continued for most developed economies in Q4, important events that unfolded during the quarter contribute to a sense of uncertainty entering into 2019:

  • The signing of the new U.S.-Mexico-Canada (USMCA) Trade Agreement to replace the North America Free Trade Agreement (NAFTA). Although this agreement was signed by the heads of the three nations involved, legislatures have yet to ratify the agreement and constituencies within each country are lobbying to change components of the accord, contributing to a lack of clarity of what the final agreement will look like.
  • A Brexit deal agreed to by the EU and Prime Minister Theresa May failed miserably in the House of Commons. The year ended with no clear plan on how the UK would leave the European Union, scheduled for March 2019.
  • Trade disputes between the U.S. and China, the world’s two largest economies, remained substantially unresolved and led in part to extreme volatilities in the financial markets at the end of the year.
  • The U.S. government began what would become the longest shut-down in its history, impacting over 800,000 workers and potentially threatening the nation’s economic expansion and continued job growth.

Some economists are expressing concern. CNN Business reports:

“Trade wars. Recession fears. Market mayhem. Oil turbulence. Brexit. And the longest government shutdown ever. Around nearly every corner, crucial question marks are looming over the business world right now. Will the U.S. economy grow at 3% in 2019 or succumb to a recession? Will the United Kingdom be in or out of the European Union? Will the Fed raise rates twice or not at all? Taken together, these forces appear to be driving up uncertainty to elevated levels. That backdrop makes it tricky for businesses, households and investors to plan for the future. The risk is that poor visibility causes companies to rein in spending, further delaying the investment boom that the U.S. tax overhaul was supposed to spark.

‘We are in an uncertain environment on the policy front and the economic front — and that spills over into the corporate front,’ said Erin Browne, a managing director and portfolio manager at PIMCO. In some ways, a murky outlook is common as economic expansions age and the next recession begins to take shape on the horizon.

‘As you move towards late cycle, the level of uncertainty increases. And the level of volatility around economic outcomes also increases,’ Browne said… The risk is that extreme uncertainty becomes a self-fulfilling prophecy, speeding the arrival of the next downturn by causing business and consumer spending to dry up.

‘It’s inevitable we will get a recession in the next few years. The question is timing,’ said Browne. ‘This could pull forward the onset of the next recession.’”

Global Economy Watch by Price Waterhouse Coopers predicted that in 2019:

“Workers and wages will come to the fore. Labour markets in advanced economies are likely to continue to tighten, even if job creation slows. This may push up wages, but cause problems for businesses looking to fill talent shortages. In 2019 we expect unemployment rates to fall a little further in the U.S. and Germany, where the rates of job creation have remained strong. But many other economies could show evidence of hitting structural floors… We expect trade wars to continue in 2019. This is likely to generate further uncertainty for policymakers and businesses.” 

PeopleScout Canada Jobs Report Analysis — December 2018

Canada’s unemployment held steady in December as job creation neared market expectations following a large increase in hiring November. Statistics Canada reported that the Canadian economy added 9,300 jobs last month. Market expectations were for an increase in employment of 10,000, according to economists at Royal Bank of Canada. In November,  Canadian employment rose by 94,100, so the jobs added in December are a steep decline from the previous month. Canada’s unemployment rate was 5.6% in December, unchanged from November when it fell to its lowest level in more than 40 years.

Canada Jobs Report Analysis — December 2018

The Numbers

9,300: The economy gained 9,300 jobs in December.

5.6%: The unemployment rate remained at  5.6%.

1.8%: Weekly wages increased to 1.8% over the last year. This is a 0.3% increase from November’s wage growth figure.

The Good

In 2018, employment increased by 163,000 or 0.9%. In 2018, the unemployment rate fell 0.2 percentage points to 5.6%. Full-time employment continued on an upward trend in 2018, growing by 185,000 or 1.2%, while part-time employment barely changed.There were some job gains in important sectors in the Canadian economy in December including transportation and warehousing; healthcare and social assistance as well as manufacturing. 

Manufacturing added 23,900 jobs which is an increase of 1.4% in a one month period.


The year had notable gains for Canadian women and older male workers. Among the core-working-age population (aged 25 to 54), employment in 2018 increased notably for women (+126,000 or +2.2%) and for men (+61,000 or +1.0%). At year end, the unemployment rate among this age group was 4.6% for women and 4.8% for men. For men and women aged 55 and over, employment rose by 50,000 (+1.2%) in 2018, with most of the increase among men (+43,000 or +2.0%), whose unemployment rate fell 0.8 percentage points to 5.3% over the period. For women in this age group, employment was little changed but remained strong, with their unemployment rate at 4.6%.

The Bad

The 0.9 per cent jobs growth rate in 2018 shows that the rate of growth has slowed compared with 2017 (+2.3 per cent) and 2016 (+1.2 per cent). Lackluster wage growth continues to be a concern and even a mystery as The Financial Times notes:


“Overall, average hourly wages increased two per cent in December from a year earlier, lifting the five-month trend to about 2.2 per cent. So, after several years of good-to-great aggregate employment growth, wages are only keeping pace with inflation. That’s as odd as it is disappointing.


Before this year, the jobless rate rarely fell below six per cent. Now it’s the ceiling. The unemployment rate was 5.6 per cent in November and December, the lowest in data that dates to 1976, and it has brushed six per cent only twice since November 2017.


With hiring at levels that economists associate with full employment, you’d expect stronger upward pressure on salaries. But for whatever reason, that’s not happening.”

The Unknown

Some experts consider early 2019 to be the late stages of a positive economic cycle for Canada, setting off speculation on when the next recession will start and generating concern in provinces like Alberta which have experienced recent economic difficulties:


“‘We are in the late stages of a business cycle,’ Craig Alexander, chief economist of Deloitte said. ‘That doesn’t mean that a recession is around the corner, but we need to recognize that we’re 10 years into an economic recovery, expansion. Business cycles are typically eight to 10 years long.’


Alexander said markets are probably overreacting to the possibility that another downturn could be almost upon us. He thinks the more likely case is that growth will continue to slow.


The economy’s evolution will have different impacts depending where one lives, he added.


For example, the energy sector faces big challenges.


Part of it comes from the recent plunge in oil prices, but there’s also been an extra discount on the price of western Canadian crude caused by transportation bottlenecks out of the Alberta oilpatch.


‘This is sad news for Alberta,’ Alexander said. ‘They’ve only barely recovered from the last recession.’”

PeopleScout U.S. Jobs Report Analysis — December 2018

The Labor Department released its December 2018 Jobs Report which shows that U.S. employers added 312,000 jobs in December. The unemployment rate increased to 3.9 percent last month. Year-over-year wage growth increased to a 3.2 percent pace as the best rate since 2008. U.S. employers have added to payrolls for 99 straight months, extending the longest continuous jobs expansion on record.

U.S. Jobs Report Analysis — December 2018

The Numbers

312,000: The economy added 312,000 jobs in December.

3.9%: The unemployment increased to 3.9 percent.

3.2%: Wages increased 3.2 percent over the last year.

The Good

The 312,000 jobs added greatly beat analyst expectations. After revisions to the October and November data, the U.S. added a net 2.64 million payrolls in 2018, the best year for job growth since 2015. Wages, which had been slowing rising for much of 2018, have begun to pick up more quickly. December’s year-over-year increase hit 3.2 percent. While the unemployment rate increased to a five-month high, it is not a cause for concern because the participation rate stands at 63.1 percent and is the highest since September 2017. Reaction to the report has been overwhelmingly positive. As one Bloomberg economist noted:

“This is the strongest employment report of this economic cycle – hands down. While we’ve seen greater job gains in some months, the plus-300,000 number along with another increase in average hourly earnings clearly signals that the economic expansion ended 2018 on strong footing. Perhaps most surprising was the two-tenths rise in the unemployment rate due to an increase in participation. It’s one month of data, but talk of the Fed cutting rates in the near future should be off the table for now.”— Tim Mahedy, Bloomberg Economics

The New York Times reported even more jubilant reaction:

“It’s an unequivocally phenomenal report all the way around,” said Ellen Zentner, chief United States economist at Morgan Stanley. “Anyone that finds something negative in this report is simply cherry picking.”

Economists offered raves that could appear on a movie poster or a book jacket — “Extraordinary!” “Blowout,” “Wow!” The figures, they said, offer a resounding response to the question of whether a recession is imminent: “Never mind!” said David Berson, chief economist of Nationwide. “The fears of the economy tipping into a recession now have clearly been overstated.”

The Bad

While there may be no notable negative points in the jobs report, the U-6, or underemployment rate, was unchanged last month at 7.6 percent. This measure includes part-time workers who want a full-time job and people who are less active in seeking work. This is a possible indication that companies that are contending with a tight talent pool may not be reaching the right part-time workers who would prefer to onboard as full-time workers.

A challenge for employers may be an emerging trend of offering part-time workers the same benefits as full-time employees. Receiving “full-time” benefits can also remove an incentive to look for full-time work.  As the Seattle Times reports:

“Almost half of the 391 companies surveyed by the International Foundation of Employee Benefit Plans now offer the same health insurance coverage for all employees. About a third offer paid maternity or parental leave to their part-time workers, too, the survey found.”

The Unknown

The tight labor market may increase pressure to allow greater immigration to the U.S. or to find a solution that will allow foreign workers to fill the gaps in the country’s workforce. Like the US, Japan is facing a declining birthrate and an aging population which has led to recently passed legislation aimed at attracting foreign workers:

“Japanese lawmakers have passed controversial legislation expanding the number of semi-skilled foreign workers who can live and work in the notably insular nation for up to five years.
Japan has been pressed to make the change because of a critical labor shortage that results from its rapidly aging society and low birth rate.

Japan’s upper house of parliament passed the law 161 to 76 just after 4 a.m. Saturday local time, after a day when the opposition parties tried to unsuccessfully to block the measure.

The law will go into effect in April 2019.

The legislation has been viewed as a last-resort measure by Prime Minister Shinzo Abe’s ultra-conservative government to address a severe shortage of workers in 14 industries, including restaurants, nursing, construction and agriculture.”

2018 In Review: PeopleScout Thought Leadership

Throughout 2018, we’ve written about some of the biggest trends in talent acquisition and workforce management. As we head into 2019, we’re looking back on some of the most important topics of the past year.

RPO, MSP and Total Workforce Solutions

Total Workforce Solutions in Practice
Drivers and Benefits of Total Workforce Solutions
Four MSP Trends to Make your Program More Effective
Hospitality Staffing: RPO and Hospitality, a Perfect Blend
Positive Global Economic Growth and Its Impact on Talent Acquisition
The Value of Globalizing your Recruitment Strategy
A look into the Gig Economy
Contingent Employment Arrangements: The Implications of the Bureau of Labor Statistics’ Survey
The Contingent Workforce Landscape: Trends and Strategies
Considerations When Sourcing Talent Globally
Expanding the Talent Landscape by Recruiting Virtual Employees
How the Skills of the Future will Impact Enterprise Recruitment Teams
How to Create a Workforce Equipped with the Skills of the Future
Wages and Recruitment: The Pressure is Building
Prospects for the Class of 2018
Changing Workforce Demographics: Aging Talent

Candidate Experience

How to Improve Your Candidate Experience
How to Create and Provide a Positive Candidate Experience
Four Factors Impacting the Way Employers Interact with Candidates
How (And Why) to Effectively Recruit Recent Graduates
Removing Barriers to Employment for the Long-Term Unemployed
Through the Grapevine: How to Create and Manage an Employee Referral Program
Rethinking Candidate Generation Strategies
Employee Retention: Combating Turnover
Ghosting in the Workplace
Strategies for Building an Effective Talent Community
The Long-Term Unemployed: Your Untapped Talent Pool

Healthcare HR

Healthcare Workforce and Recruiting Trends to Watch
Six Things to Expect from your Prospective Healthcare RPO Partner
Paging All Doctors: Effective Physician Recruiting Strategies and Tactics
Rural Healthcare: How to Recruit and Attract Clinical Talent in Rural Areas
How to Use Pre-Employment Assessments and Testing in Healthcare Recruiting
Leveraging Recruitment Marketing to Attract Healthcare Talent
Healthcare HR Technology To-Do List
Healthcare Recruiters: How Technology is Improving Healthcare Recruiting
How To: Sourcing Healthcare Workers
Healthcare Recruiting Lexicon
Medical Staffing: How to Engage and Retain Healthcare Workers
Recruiting a Traveling Nurse: What You Need to Know
Healthcare Workforce Planning: What You Need to Know
Finding the Right RPO Provider for Your Healthcare Staffing Needs
Six Tips for Healthcare Recruiting
Talking Talent Podcast: Navigating the Talent Acquisition Challenges of a Major Hospital Expansion
Talking Talent Podcast: How HR Technology Can Combat Staffing Shortages in Healthcare
Talking Talent Podcast: Addressing the Workforce Gap in Nursing
Talking Talent Podcast: How RPO Can Solve the Top Challenges in Healthcare Talent Acquisition
Ebook: How RPO Can Solve the Top Challenges in Healthcare Talent Acquisition
Ebook: Healthcare Recruiting Lexicon

Technology

Reducing Unconscious Bias with AI
How to Leverage Workforce Analytics in Workforce Planning
Virtual Reality: Enhancing the Candidate Experience
Workforce Planning: Leveraging Workforce Analytics for Deeper Insights
How Robotic Process Automation is Reshaping Recruiting
Predictive Analytics: A Powerful Talent Acquisition Tool
How to Use Chatbots to Improve Recruiting
Talking Talent Podcast: Using Robotic Process Automation to Streamline Recruiting Processes
Talking Talent Podcast: Using Predictive Analytics to Hire Best Talent Faster
Talking Talent Podcast: How HR Technology Can Combat Staffing Shortages in Healthcare
Ebook: Using Chatbots to Improve Recruiting

Talking Talent with PeopleScout, our Podcast

How Many Requisitions Should a Recruiter Carry?
How Employers Can Learn to Translate Military Resumes and Hire More Veterans
Addressing the Workforce Gap in Nursing
How RPO Can Solve the Top Challenges in Healthcare Talent Acquisition
Using Robotic Process Automation to Streamline Recruiting Processes
Using Predictive Analytics to Hire Best Talent Faster
Navigating the Talent Acquisition Challenges of a Major Hospital Expansion
How HR Technology Can Combat Staffing Shortages in Healthcare

Military and Veteran Hiring

Military Spouses: How to Hire the Overlooked Talent Pool
Building a Veteran Onboarding Program
Talking Talent Podcast: How Employers Can Learn to Translate Military Resumes and Hire More Veterans
Ebook: Best Practices for Hiring Veterans

Ebooks and Whitepapers

Best Practices for Hiring Veterans
How RPO Can Solve the Top Challenges in Healthcare Talent Acquisition
Using Chatbots to Improve Recruiting

Compliance Corner

Washington State’s Paid Medical and Family Leave Program
Sexual Harassment
Department of Labor Office of Compliance Initiatives
California Consumer Privacy Act of 2018
Ban the Box Update
Arbitration Agreements
Worker Classification in the Gig Economy
Salary History Update
CAN-SPAM, CASL and More
GDPR
HR Compliance Trends for 2018

PeopleScout UK Jobs Report Analysis — December 2018

If you are inclined to celebrate and have a few friends over when the UK labour market report is filled with positive news, then, by all means, start icing the champagne. December’s report published by the Office for National Statistics includes the following details:

  • Wages continued to rise at their highest level in nearly a decade.
  • The number of people working in the UK rose by 79,000 to 32.48 million. That is the highest figure since records began in 1971.
  • The unemployment rate was 4.1 per cent, virtually unchanged compared with May to July 2018 and lower than the estimate for a year earlier (4.3 per cent).
UK Jobs Report Analysis — December 2018

Rising Wages: The Missing Part of the Recovery. Until Now.

Wages are growing ahead of the rate of inflation and it is thought that this rise is pay is due to the tight job market. As the Financial Times reports:
“The rise in salaries is also beginning to overcome significant increases in prices. Real regular pay, which takes into account inflation, was up 1.1 per cent in the October period — a level not seen since late 2016.


‘While Brexit uncertainty and political paralysis are having a cooling effect on the wider economy, the labour market is proving more resilient,’ said Stephen Clarke, senior economic analyst at the Resolution Foundation.


‘Britain’s tightening jobs market is delivering stronger pay rises, particularly for workers in ICT (information and communication technology), hospitality, and real estate,’ he said. ‘2019 looks set to be a far better year for pay than this one.’


Real pay growth has, until recently, been the missing part of the UK’s post-crisis recovery. While unemployment fell and employment rose, pay growth remained stubbornly low and, in real terms, median pay packets are still worth less than they were in 2008.”


The December ONS report notes that for October 2018 average regular pay (excluding bonuses), before tax and other deductions from pay, for employees in Great Britain was £495 per week in nominal terms (that is, not adjusted for price inflation), up from £479 per week for a year earlier. This would be £1,916 in a four week month. This is certainly welcome news for Britain’s workers. But while wages are rising faster than inflation, it is not clear that they are keeping up with key elements of the cost of living. For example, the average cost of renting a home in Britain per month was £1,212 in November or nearly two thirds of the average wage earner’s monthly salary.

Historic Employment Figures: A Challenge for Employers

While the number of people working in Britain rose to a record high, unemployment also increased by 20,000 to 1.38 million. The ONS report notes that “The reason both employment and unemployment have increased is a result of the UK’s rising population and more people joining the labour force, such as students and older people.”


The challenges presented by a tight labour market is a cause for concern for UK employers:


Suren Thiru, head of economics at the British Chambers of Commerce, commented, “Businesses report that the political and economic turbulence, together with significant difficulties finding the right staff, are diminishing recruitment intentions, which is likely to increasingly weigh on the UK labour market over the near term. More must be done to support firms looking to recruit.”


The lack of available workers is compounded by a skills shortage in the UK, particularly in the technology sector as The Times reports:


“The technology industry fears that a skills shortage could stunt its growth, with new figures showing that job vacancies are growing.


The number of unfilled positions in the information and communication technology sector last quarter rose by 24.3 per cent compared with a year ago, according to data from the Office for National Statistics, one of the largest increases of any industry.


The ratio of jobseekers with previous employment in the industry to relevant jobs has dropped below one, meaning that there are more vacancies than people looking to fill them.”

Brexit Uncertainties: The Unwelcome Guest that Just Won’t Leave

No matter how good a jobs report may be, uncertainty over Brexit continues to cast a shadow over any positive economic news:


“Leaving the EU is likely to disrupt many sectors of the UK economy, including those that rely heavily on European workers. The magnitude of the disruption will depend on the details of the final Brexit agreement, which is making its way through a tortuous political process leading up to the March 29 deadline. In the longer term, the trading relationship between the UK and the EU after the Brexit transition period will be crucial. Will trade continue to be nearly frictionless or will it suffer economic and administrative barriers? Will migration policy support or hinder growth? The answers to those questions will determine the extent to which Brexit affects the economy’s productivity and thus the living standards of UK residents.


Hiring challenges. Low unemployment, falling migration and uncertainty about post-Brexit migration policy mean that businesses in many sectors are finding it increasingly difficult to hire staff. To recruit the workers they need, will employers tap more into under-utilised demographic groups? Young people, single parents, minorities and people with disabilities are less likely than average to be part of the labour force and their unemployment rates are above average. Whether employers manage to attract those groups into employment through higher wages or benefits — or whether they respond to hiring difficulties in other ways, like investing in automation — is a trend to watch in 2019.”


So by all means, open up that bottle of champagne. The ONS report provides plenty of good reasons to celebrate. Just be aware that there are many sobering details that must be dealt with after the celebration ends.

PeopleScout Canada Jobs Report Analysis — November 2018

Canada’s unemployment rate fell to 5.6 per cent, the lowest level since 1976. Canada added 94,100 net jobs for its largest monthly increase since March 2012, Statistics Canada said in its most recent labour force survey. But even with healthy job growth, wage gains appear to be slowing. Both hourly and weekly wage growth rates have been dropping since May and are below the rate of inflation.

Canada Jobs Report Analysis — November 2018


The Numbers

94,100: The economy gained 94,100 jobs in November.

5.6%: The unemployment rate fell to 5.6 per cent.

1.5%: Weekly wage increases are 1.5 per cent over the last year. This is a 0.3 per cent decrease from October’s wage growth figure.

The Good

The 94,100 jobs gained in November were fueled by 89,900 new full-time positions and 78,600 employee jobs in the private sector. Employment among the core age group (those aged 25 to 54) was up 49,000 in November, the result of increases for both women (+32,000) and men (+17,000). The unemployment rate fell by 0.4 percentage points to 4.6 per cent for core-aged women, and by 0.2 percentage points to 4.7 per cent for core-aged men. In the 12 months to November, employment within this age group rose by 208,000 (+1.7 per cent), largely the result of gains for women (+129,000). In the 12 months leading up to November, employment grew by 219,000 or 1.2 per cent.
Employment was up in six provinces including Quebec with 26,000; Alberta with 24,000; Ontario with 20,000; British Columbia with 16,000; 5,500 in Saskatchewan and 2,600 in Manitoba. On a year-over-year basis, the number of private sector employees rose by 146,000 (+1.2 per cent), while the number of public sector employees grew by 48,000 (+1.3 per cent).

The Bad

Average weekly wage growth fell to just 1.5 per cent and hourly wage growth slowed as well as the CTV reports:
“Year-over-year average hourly wage growth for permanent employees continued its decline in November to 1.46 per cent — its lowest reading since July 2017.
‘There’s no question that the headline job growth is gangbusters strong,’ said Frances Donald, head of macroeconomic strategy at Manulife Asset Management
‘I would caution us against celebrating too quickly, however, because wage growth is decelerating sharply.’”
Experts have been expecting wage growth to pick up its pace, thanks to the tightened labour market. But the opposite has been happening — wage growth has dropped every month since its May peak of 3.9 per cent and now sits well below inflation.
Employment declined in information, culture and recreation (-10,000 or -1.3 per cent), continuing the downward trend that started in August. The decrease was driven by Ontario. Compared with 12 months earlier, employment in this industry was down by 25,000 (-3.2 per cent) at the national level.

The Unknown

The Financial Times reports that the digital economy has created a demand for 216,000 more tech workers, according to a new study. However, it is unclear whether there are enough available workers in Canada to meet this demand:
“Blockchain, artificial intelligence, 5G mobile networks, 3D printing and virtual reality are creating a need for digital skills that will see a demand for an estimated 216,000 additional technology workers by 2021, according to a new report.
A study by the Information and Communications Technology Council (ICTC), found that employment of information and communications technology professionals outpaced the economy last year six-to-one.
‘What’s happening now is we are seeing fast-paced industries go from low growth to high growth,’ said Namir Anani, president and chief executive of ICTC.
‘We have to look at how do we reposition the workforce rapidly through short-duration training to provide pathways and mobility to get into fast-growth sectors of the Canadian economy that are increasingly becoming digital.’
As more industries recognize the importance of a digital strategy, competition for tech workers has increased. ICTC highlighted transportation, retail, healthcare, finance and manufacturing as sectors where demand is ramping up.
‘The environment is changing fast and every sector is seeing its own disruption,’ Anani said.
‘We have to reflect as a country on how do we leverage (disruption) and what are the transitional strategies we have to build to move some of the displaced workers from low-growth to high-growth areas of the economy.’
There was a five per cent increase in employment for digitally skilled workers in 2017, the highest growth in 10 years, according to ICTC’s report. Meanwhile, 60 per cent of Canada’s tech workers were now spread across non-tech sectors.
Not only are Canadian companies struggling to find enough digitally skilled workers to fill positions in the present, but the largest group of tech workers is already approaching retirement, with 13.1 per cent being between the ages of 55 to 64. ICTC’s research was conducted with the support of Microsoft Canada.
‘The issue is really about supply and demand. The demand is increasing as more sectors are adopting digital technologies and the supply of talent and skills is a challenge,’ said Navdeep Bains, the federal Minister of Innovation, Science and Economic Development.
‘When we put forward our Innovation and Skills Plan, by far this was the number one issue — around training and people having the right skills to succeed today and for the job tomorrow.’”

PeopleScout U.S. Jobs Report Analysis — November 2018

The Labor Department released its November Jobs Report which shows 155,000 jobs added to the U.S. economy. The pace of hiring slowed while the unemployment rate remained at 3.7 percent, which is the lowest point since 1969. The participation rate also remained unchanged at 62.9 percent. U.S. employers have added to payrolls for 98 straight months, extending the longest continuous jobs expansion on record.

U.S. Jobs Report Analysis — November 2018



The Numbers

155,000: The economy added 155,000 jobs in November.

3.7%: The unemployment remained to 3.7 percent.

3.1%: Wages increased 3.1 percent over the last year.

The Good

The 155,000 jobs added to the economy in November adds to an unprecedented run of continuous growth. 2018 is shaping up to be a year of impressive expansion given the 12 month job growth in key sectors of the American economy: Healthcare employment has increased by 328,000; Manufacturing has grown by 288,000 and Business and Professional Services has expanded by 561,000 jobs.
The annual wage gain is also a sign that the economy is continuing to grow, but at a more measured pace than earlier in the year. As the New York Times reported:
“It’s obviously an economy that is well in expansion mode but that is coming off the boil after a strong second and third quarter,” said David Donabedian, chief investment officer of CIBC Private Wealth Management. “So the state of the job market is good. It’s just that the pace of job creation is slowing a little bit.”
Yearly wage growth remained at 3.1 percent for the second month in a row, a level not seen since the recession. “If you have solid wage growth while productivity is improving, that is the best of both worlds,” Mr. Donabedian said.

The Bad

The 155,000 jobs added in November fell below analyst expectations. The slowing pace of hiring is perceived to be caused by the inability of employers to find the right workers to fill their open positions. This appears to be the case in many parts of the economy, including those with some of the highest job gains this year such as healthcare. The Wall Street Journal reported on one such business in the high-demand area of elder care:
“The modest job-growth slowdown could be a sign of slightly softer demand for goods and services by consumers. For some companies, hiring also might be slowing because they can’t find the workers they need because unemployment is so low.”
That was the case for Home Instead Senior Care, an Omaha, Neb.-based in-home care provider, said its Chief Executive Jeff Huber. The company employs about 65,000 U.S. caregivers through its franchises, a 23 percent increase from three years ago.
“We could grow even more robustly if the labor market weren’t so tight,” Mr. Huber said. “The competitive job market is really restricting on our growth. There’s just tremendous demand for caregivers.”
Labor costs for the company, including wages and benefits, have risen about 20 percent annually in recent years, he said, but revenue is also growing robustly. The company is offering more training and flexible schedules to attract and retain employees, and recruiting older workers who have finished careers but aren’t ready to fully retire. A third of caregivers are older than 60, Mr. Huber said.

The Unknown

The recent announcement that General Motors would be laying off nearly 14,000 workers raises the question of whether these newly available workers would have the skills required to find new work, even in the current labor market in which job seekers are highly favored. This point was underscored by General Motors CEO Mary Barra:
“As Barra announced the cutbacks, she also said GM plans to acquire “skillsets of the future” by hiring in software development, battery and fuel cell technology and autonomous vehicle development,” The Detroit News reported. “You will see us having new employees join the company as others are leaving,” she said. “We still need many technical resources across the company.”