Where does job growth really occur, and how is it measured? The news/predictions/projections vary so much, it is interesting to read the details behind these statistics. Cruise through any business journal, and it is amazing how different the interpretations are.
First of all, there were months in which hiring increased and we were all excited. Then we found out that many of these new hires were seasonal or temp jobs, such as the census workers who later rejoined the unemployed. Some of those we count as employed are “involuntarily underemployed” meaning their hours were reduced by the companies who employed them. An article in the New York Times this week said that retailers are not planning on adding large numbers of workers for the holiday season, and many of the positions offered are as a result of a previous reduction in force!
Prevailing opinions are that most job growth occurs in the small business sector, and stimulus money has been focused on this sector, but not much is happening. The tech sector took a hit as renewable energy companies lost some of their investment and tax incentive support. These were the green jobs that were supposed to save us all. It seems that the projected growth in health care employment may not be as great as predicted, because the industry is waiting to see what effect the new healthcare programs passed by Congress will do to their bottom line.
It is a vicious cycle…companies cut back on staffing because demand for their products or services has dropped, so people don’t have jobs or money to spend so they don’t buy the products that companies have to offer because they are trying to conserve…how will it end? Companies who do want to expand and might be willing to add jobs can’t get financing for the growth.
There is opportunity in the startup or new small business sector, as they can be more flexible in adjusting to economic change. One business blog held that research shows that these companies are the real producers of new opportunity, and that more small business support should be focused here.
Such a conundrum!
Job Growth
- Posted Oct 6th, 2010
- by Ingrid Baker;
- Categories: Economic Trends, For Employers, Hiring Trends, Job Hunting;
- Comments: 1
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David Borton
on Oct 9th, 2010
@ 2:52 am:
Thank you Ingrid Baker for this timely article. There is another side to your observation that “Companies who do want to expand and might be willing to add jobs can’t get financing for the growth.”
This may true of smaller companies, but many larger companies are sitting on unprecedented and still-growing mountains of cash, taking advantage of record-low interest rates, and squeezing as much productivity as they can out of their work force. They are choosing not to hire now ostensibly because of uncertainty in the future of consumer demand.
One of many recent articles on this subject can be found in the NY Times by searching http://www.nytimes for “Cheap Debt for Corporations Fails to Spur Economy.”