PwC: Manufacturing Hiring Plans Hit Five-Year High

October 21st, 2013

PwC’s Q3 2013 Manufacturing Barometer shows a gain in U.S. industrial manufacturers with an optimistic view of the global economy during the next 12 months to 40% in the third quarter from 31% in the second quarter and 29% a year ago. In addition, 60% are optimistic about the U.S. economy, and 78% think the U.S. economy grew in the third quarter, marking the highest level in seven years. “Despite the uptick in global economic sentiment, the U.S. remains the growth driver in the industrial manufacturing sector, with continued signs of healthy demand, pricing strength, new product investment, and hiring,” says Bobby Bono, U.S. industrial manufacturing leader at PwC.

The survey reveals that 58% of respondents plan to add employees during the next 12 months, up 16 points from the second quarter, with demand high for skilled labor (35%), professionals and technicians (35%), and production workers (30%). However, 77% said they need to fill skill gaps, the biggest of which are in middle management (70%) and skilled labor (67%). Another 50% of respondents said they had open positions that cannot be filled with skilled employees.

Each Chicago manufacturing job leads to 2 more: study

May 21st, 2013
By  Meribah Knight  May 21, 2013

It’s called a multiplier effect: when one job generates another job that is  dependent on that job, and so on. In the Chicago area, each new manufacturing  job creates another 2.2 jobs in the region, on average, according to a new study  by the University of Illinois at Chicago.

the most robust areas for job multiplicity are in the manufacturing of  petroleum and coal products and in pharmaceuticals, each generating 8.3 and 5.7  jobs, respectively, in the region, according to the report from UIC’s Center for  Urban Economic Development.

The study found that chemical manufacturing generates 3.8 jobs, and beverage  and tobacco products create 3.6 jobs. Textile manufacturing jobs came in last,  generating only 0.5 additional jobs, the study found.

“Most of these industries are powerful job creators,” said study co-author  Howard Wial, executive director at the Center for Urban Economic Development and  a Brookings Institution fellow. He worked on the report with Elizabeth Scott, an  economic development planner in the Center for Urban Economic Development.

To find the overall multiplier, the study added each new manufacturing  factory job with jobs in supply industries, and then jobs in service industries  that each manufacturing employee patronizes. The study, which begin measuring  the impact with only factory jobs — it does not include research and development  or administrative positions at manufacturing companies — analyzed seven counties  in Illinois: Cook, DuPage, Kane, Kendall, Lake, McHenry and Will.

The Chicago region’s overall average of a 2.2 job multiplier for the  manufacturing industry is on par with other metropolitan regions, Mr. Wial said.  On a national scale, the multiplier for a manufacturing job is 4.6, higher  because of a larger geographic scope for supply chains and induced spending.

Manufacturing tends to have a higher multiplier than other industries because  of its sturdy wages and long supply chains, Mr. Wial said.

The finding that petroleum and coal — realized mainly as the region’s oil  refining industry — generated the most impact in the Chicago area was  unexpected, Mr. Wial said. He said it was surprising to find that the region’s  oil and coal industry had such a lengthy supply chain, making even more of an  impact than automotive or machinery sectors.

The report found that Chicago’s two largest manufacturing industries, food  and fabricated metal, create 2.6 and 2 additional jobs, respectively.

“When a new job in an industry leads to the creation of even one other job in  the region, that’s a very good return,” Mr. Wial said. “That’s why policymakers  still prize manufacturing for its potential to create jobs, despite growing  automation.”

In other words: Even while manufacturing jobs dwindle as human capital is  replaced with robots and automated machinery, a higher output will still result  in more jobs, Mr. Wial said.

“Industries with higher productivity typically pay higher wages, leading to  more induced jobs,” he said.

And the region’s recent  growth in the manufacturing sector can only mean good things for  putting the multiplier into action.

“Until recently, offshoring, consumer spending on imported goods and the  growing use of out-of-region suppliers reduced manufacturing’s impact on job  growth in the Chicago area,” Mr. Wial said. “The recent rebound of manufacturing  employment may change the situation.”

 

More Corporate Economists See Increased Hiring in Next Six Months

April 23rd, 2013

Wall Street Journal (04/22/13) Eric Morath

A significant economic slowdown may not materialize this spring after all, according to the National Association for Business Economics. A NABE survey of corporate economists released Monday found U.S. companies are more optimistic about the economy and plan to hire. Some 40% of those surveyed say their company or sector intends to boost hiring in the next six months. Just 9% intend to lay off employees.

“Overall business activity has been expanding for well over three years…we’re at the point where companies can no longer just pay overtime, and need to go hire more people,” says Ken Simonson, chief economist for the Associated General Contractors of America.

Almost two-thirds of the economists surveyed forecast the economy will grow at a pace faster than 2% in the next year, up from 50% that projected similarly strong growth in a January survey.

ADP: Companies added 158,000 jobs in March

April 3rd, 2013

By Paul Davidson, USA TODAY12:29p.m. EDT April 3, 2013

Businesses added 158,000 jobs in March, payroll processor ADP said Wednesday, fewer than expected and possibly raising concern about the government’s closely-watched employment report for March, due Friday.

Economists had forecast that ADP would report private-sector job gains of 215,000. They expect the Labor Department on Friday to report 195,000 net jobs added in March. That figure would include the private sector and federal, state and local governments, although governments have been cutting payrolls.

Professional and business services led job gains with 39,000, trade and transportation added 22,000 and financial firms, 9,000. Construction companies added no net new jobs after several months of solid gains during a housing rebound.

“Construction employment gains paused as the rebuilding surge in the wake of Superstorm Sandy ended,” said Mark Zandi, chief economist of Moody’s Analytics, which works with ADP to compile the report. “Anticipation of health care reform may also be weighing on employment at companies with close to 50 employees. The job market continues to improve, but in fits and starts.”

Small businesses and midsize businesses accounted for most of the job gains for the third straight month. Small businesses added 74,000 jobs; midsize ones, 37,000 and large companies, 47,000.

ADP often reflects the same broad trends as Labor’s report, but the firm has had mixed success forecasting. Last month, ADP estimated businesses added 198,000 jobs in February while Labor reported 246,000 gains.

Total non-farm payrolls rose 236,000 in February, and the unemployment rate fell to 7.7% from 7.9%, the government said.

The economy has remained resilient despite a recent rise in payroll taxes for working Americans and across-the-board federal spending cuts that started to take effect March 1.

This week, an index of manufacturing activity fell slightly, but its measure of factory employment ticked up.

Meanwhile, consumer and business spending have held up, and the housing rebound has picked up steam. Many economists are revising their estimates for first-quarter economic growth higher, to near 3%.

Leadership Tip

February 5th, 2013

What leadership lessons can you learn from James Bond? According to David K. Williams, Forbes contributor, skip the motivational speeches. Flashy orations aren’t the only way to get people to do what you want. In Thunderball and The Spy Who Loved Me, Bond demonstrated that it’s not always necessary to persuade your team to follow you into battle (or in his case, to even put their lives on the line). Often, simply charging forward with sufficient confidence and courage will inspire employees to follow your lead.

Job Openings and Labor Turnover Changed Little in October U.S. Bureau of Labor Statistics (12/11/12)

December 12th, 2012

There were 3.7 million job openings on the last business day of October, little changed from September, the U.S. Bureau of Labor Statistics reported on Dec. 11. The hires rate (3.2%) and separations rate (3.1%) were also little changed in October.
The number of openings was little changed in all industries except construction, manufacturing, and accommodation and food services, which increased. The number of openings was also little changed in all four regions in October. The hires rate was also little changed in all industries and regions over the month. The total separations rate was little changed for total nonfarm, unchanged for total private, and rose for government. Over the 12 months ending in October, hires totaled 51.7 million and separations totaled 49.8 million, yielding a net employment gain of 1.9 million.