Hiring activity will reach a four-year high for August in both the manufacturing and service sectors, according to the Society for Human Resource Management’s monthly Leading Indicators of National Employment® (LINE) Report released last week.
It's good news for an industry that has bounced back in a big way. Job opportunities are plentiful in manufacturing and service sectors and that's good news for job seekers. While there is still some skill gaps, those with education and experience in manufacturing can find good opportunities. Unfortunately, the skills gap in the manufacturing industry isn't without cause for concern for manufacturing recruiters.
“The continued increases in hiring are also boosting recruiting difficulty,” said Jennifer Schramm, manager of workforce trends at SHRM. “As more employers compete to fill their key jobs, difficulty finding candidates with the right skills and experience is rising.”
Roughly one-half of manufacturers (50.2 percent) and more than one-third of service-sector companies (35.8 percent) reported that they will add jobs in August. The report also showed a slight hiring rate increase compared with a year ago for manufacturing (0.3 percent) and the service sector (0.7 percent).
According to the report, the month of August also marks the third consecutive month that hiring has reached a four-year high for both sectors in the LINE survey.
The SHRM LINE Report, based on a survey of human resource professionals, predicts employment activity for the coming month, about 30 days before statistics on employment for the same time frame are available from the U.S. Bureau of Labor Statistics.
HR professionals’ recruiting challenges for key positions also hit a four-year high for July in both the manufacturing and service sectors.
In July, more employers also raised pay for new hires compared with a year ago. A net total of 8.8 percent of manufacturing sector respondents reported increasing new-hire compensation in July, an increase of 2.7 points compared to July 2013. For the service sector, 12.3 percent of companies reported increasing new-hire compensation, up 4 points from a year ago.
“We may finally be seeing recruiting difficulty impacting wages, which have remained relatively stagnant well into the recovery,” Schramm explained. “More HR professionals in both sectors are reporting that they had to increase new-hire compensation compared with the same time a year ago.”
Still, however, the index’s overall data shows most organizations are keeping new-hire compensation relatively flat.
The LINE Report provides a snapshot of month-ahead hiring expectations and examines difficulty in recruiting top-level talent, new-hire compensation and job vacancies. Respondents include HR professionals from private service-sector companies and manufacturing companies. Together, these sectors employ more than 90 percent of U.S. private-sector workers.