Employment Indicators Continue To Rally But Hiring Remains Challenging
The U.S. jobs outlook continued to improve in June, with The Conference Board’s Employment Trends Index following May’s growth with further increases. The Index reached 109.84 in June, up from 107.7 the previous month, and is now up 28.2 percent year-over-year compared to June 2020.
The Employment Trends Index is a composite index for employment. Changes in the index indicate that a turning point in the number of jobs is about to occur in the coming months. It aggregates eight leading indicators of employment, each of which has proven accurate in its own area. The Conference Board notes that aggregating individual indicators into a composite index filters out “noise” to show underlying trends more clearly.
The June increase in the Index came as the U.S. Bureau of Labor Statistics reported another significant month of growth. Total nonfarm payroll employment rose by 850,000 in June, with the unemployment rate slightly changed at 5.9 percent. It says that notable job gains occurred in leisure and hospitality, public and private education, professional and business services, retail trade and other services.
“The very rapid improvement in the Employment Trends Index in June suggests that strong job growth will continue through the summer,” says Gad Levanon, head of The Conference Board Labor Markets Institute. “In the coming months, the U.S. labor market is likely to remain very tight. Recruiting and retention will remain extremely difficult, and wage growth will remain very high. Toward the end of 2021, labor shortages are likely to moderate as some of the labor supply constraints ease. But as the number of jobs in the U.S. economy continue to grow at an historically high rate, unemployment may again dip below four percent within the next 12 months. A tight labor market is likely to be the new normal until the next recession.”
The tight labor market is being felt across the business landscape, including in the promotional product industry. Tom Goos, MAS, president of Kirkland, Washington-based distributor Image Source, says, “It is tight. We have four open positions currently and are having a much harder time attracting talent. Overall, the number of resumes we have received is down 50 percent from our normal number. Washington State just recently started requiring people who are out of work and receiving unemployment benefits to show proof they are actively looking for job opportunities. The second half of the year will be busy, and we are hoping to staff up to meet client needs.”
Tamara Borello, MAS, chief operations officer at distributor EPromos Promotional Products in St. Cloud, Minnesota, adds, “The mid-high-level positions are easier to fill, but more competitive now. The entry-level and more administrative roles are challenging as people are not as willing to make a change as easily. Conversely, those in current management roles seem to be curious as to what other positions and alternatives may exist. Remote is absolutely preferred over mandatory in-office position requirements.”
Kevin Nord, president of Pittsburgh, Pennsylvania-based Pro Towels, says, "The labor market is very tight and we are constantly looking at new ways to think out of the box to engage potential employees. There are challenges that fortunately we have been able to overcome with our leadership team."