Engineering, scientific, research and development or R&D and technical candidate recruiting continues to yield a limited supply despite the high recruitment demand. This contributed to the unemployment rate falling to a seasonally adjusted 3.9% from 4.0% the prior month.
This trend is contrary to the overall job market, which the Labor Department reported on Friday added only a seasonally adjusted 157,000 jobs added in July. However, this still gave rise to its 94th straight month of job creation, which was another new record! It also prompted wages rise a modest 2.7% from a year earlier.
Engineer Shortage Cited During Recent CBS Radio Appearance
Further proof of the shortage of engineers, scientists and key technical talent came during last Monday’s radio appearance on CBS Radio affiliate WBBM News Radio 780. During this media appearance I cited a need for a more aggressive, pro-active recruiting approach due to our current War for Talent. This includes adopting my 8th Commandment of Recruiting, “Constantly Recruit.”
As I share in this commandment, don’t wait for a job opening to seek out talent. Instead, attend trade shows and industry events to build your staffing network. Additionally, adding an internal or external recruiter to uncover and evaluate key staffing prospects.
Then keep in touch with this talent and build a potential employee database. Then when you have a job opening they may be available to meet your staffing needs. Remember to constantly recruit.
More Jobs Data Points To Recruiting Becoming More Difficult
The Labor Department also mentioned today that long-term job prospects appear promising. Their revised figures show employers added 248,000 jobs in June and 268,000 in May, a net upward revision of 59,000.
Through the first seven months of the year, employers added an average of 215,000 a jobs a month, a somewhat unexpected acceleration from last year’s average through July of 184,000 a month. Economists generally expect hiring to ease in the later stages of an expansion when workers are in short supply, which a 3.9% jobless rate would suggest.
The job report showed the manufacturing industry added 37,000 jobs in July. Leisure and hospitality, as well as professional and business services expanded payrolls strongly. Government payrolls declined by 13,000.
One reason employers have been able to hire is the share of Americans working or looking for work has started to edge up after a long decline. In July, the share of American adults working or looking for a job held at 62.9% after a June increase. The rate is up slightly from a recent low of 62.3% in 2015, but still near the smallest share of adults participating since the late 1970s, a time when women were still entering the workforce in greater numbers.
A tighter labor market, in theory, should also translate into faster wage growth, as employers compete for scarce labor. While wages have yet to break out, they are climbing at a faster pace than earlier in the expansion.
Average hourly earnings for all private-sector workers increased by 7 cents last month to $27.05. GMM Nonstick Coatings, a 350-employee supplier of coatings for cookware companies like Calphalon, has added about 25 workers this year. Ravin Gandhi, chief executive of the supplier, said adding new hires means competing for highly educated workers, many in research and development.
To compete, it has raised wages about 5% to 6% in the first half of 2018 compared with the same period a year earlier. This marks an acceleration from the 1% to 2% pay raises the company was offering a few years ago. “It’s really hard to get good people,” Mr. Gandhi said. “You’ve got to really roll the red carpet out and go after people and kind of poach them and make them offers they can’t refuse.”
Friday’s report showed the broadest measure of unemployment, including those too discouraged to look for work, plus Americans stuck in part-time jobs who want to work full time, fell to 7.5% from 7.8% the prior month. That rate, known as the U-6, remains somewhat elevated compared with the last time unemployment was similarly low. In April 2000, the broader measure was 6.9%.