The stock market is worried. The Conference Board says a rise in its Employment Trends Index is a sign of loss of optimism. The CareerBuilder / USA Today survey says 41 percent of employers plan to hire in the coming months, which means 59 percent don’t.
Welcome to the second half of 2010.
From all indications, it promises to be just like the first half; uncertain recovery, tentative signs of a hiring pick-up; teases that job growth is accelerating.
Today’s Conference Board announcement was in line with the pattern set in the first half of the year. The Employment Trends Index rose .6, from 96.1 in May to 96.7 in June. It’s up almost 10 percent in a year.
Alas, the last two months have seen the ETI decelerate its rate of improvement, leading The Conference Board to suspect it means “that many employers are now concerned that the recovery is losing momentum.”
The Employment Trends Index is a sort of index of indices. It takes into account eight employment factors, including unemployment claims, job growth numbers from the Labor Department, and other data points. One of the latter is the response to a question about how hard jobs are to find from The Conference Board’s own Consumer Confidence Survey.
The number of consumers saying jobs were hard to find increased — one of the factors in the slowing of the ETI.
Whether that is objectively true doesn’t matter, since consumer confidence is a matter of perception. And perception is reality. Friday’s Bureau of Labor Statistics report suggests that perception has enough of a grounding in reality that it lowered the unemployment rate to 9.5 percent.
That should be good news, but the BLS numbers suggest it was caused by the hundreds of thousands of Americans who simply gave up looking for work. Even the news that 83,000 private sector jobs were created in June was offset by the loss of 200,000+ temporary census jobs.
In case you left early for the long weekend, the stock markets reacted predictably to the news, closing out a losing week in which it lost 4.5 percent.
After a weekend of rest, traders returned to work this morning ready for some bargain shopping. Within minutes of the opening, the Dow was up, rising 172 points before sliding back. The day at least ended on a positive note, up about 57 points.
I would say it has been like this since the beginning of the year, but the reality is that the stock market, which hit a high of 11,205 in April, is off 13.6 percent since.
For recruiters, especially corporate recruiters, a declining stock market makes it more likely that even the tepid hiring that has been underway may become even slower.
The CareerBuilder / USA Today survey of 2,500 hiring managers and HR professionals says hiring in the second half of the year will mirror the first. It will be slow, but jobs will be added. Twenty-one percent of employers plan on hiring permanent, full-time employees in the current quarter. However, 65 percent expect no change in the quarter.
“Employers began recruiting at a moderate but consistent pace in the first half of 2010 as confidence levels inched upward amidst a better global financial picture,” said Matt Ferguson, CEO of CareerBuilder. “The economic recovery has broadened, but employers remain guarded. The survey indicates that we’ll see sustainable new job growth through the remainder of the year, but it will be absent of any dramatic shifts.”