FEBRUARY 9,
2004
EMPLOYMENT TRENDS
By Eric Wahlgren
January's disappointing figures on
job growth in the U.S. pretty much tell the story. This year is shaping up to be
more promising than 2003 for execs looking for work. But it's not going to be a
hiring cakewalk by any stretch. Last month, companies created some 112,000 jobs
-- the strongest month for job creation in more than four years. But the feat
looks less impressive when you consider that economists had been hoping for at
least 150,000 new jobs, which is the minimum monthly rate needed to absorb all
the people who actually want to work.
The bottom line is, competition for these scarcer-than-expected openings will
remain fierce, and as a result, the job hunt will continue to be a long and
miserable odyssey of four to six months on average, according to DBM, a large
outplacement company. "There's a ton more scrutiny of candidates because
businesses want the perfect employee who will have an immediate return on
investment on salary," says Penny McBain, a managing consultant for DBM in Falls
Church, Va. "I've had one candidate who's had 11 interviews at the same company,
and still no offer."
If that's not enough to worry about, job seekers will also have to contend with
a growing trend of companies shipping jobs overseas to places like India and the
Philippines, where highly educated professionals are willing to work for a
fraction of what their U.S. counterparts make. Although the "offshoring" threat
to jobs, especially for U.S. professionals with specialized skills, may be
overblown, many experts say the phenomenon is a factor in keeping any U.S. jobs
expansion in check.
LESS PAIN FOR
MANAGERS.
Overall, however, the word from the top is more encouraging than last year. Some
25% of the executives on The Business Roundtable, an association of top CEOs who
lead a combined workforce of more than 10 million, say they expect to bring
people on in the first six months of 2004. (Another 25% said they still expect
more bloodletting, while the remaining half said they expect no change in
staffing levels.) Compare that with the beginning of last year, when a
terrifying 60% of corporate big-wigs warned they would eliminate jobs in 2003 --
and then followed through on their predictions.
In 2004, managers and professionals may not have it as rough as the rest of the
population. By January, the unemployment rate for managers and professionals
stood at just 3%, vs. 3.2% a year ago. In contrast, the general populace faces a
5.6% jobless rate. Still MBAs and managers will have better luck finding work in
certain industries than in others.
As has been the case in the past few years, health care and biotechnology will
continue to employ a growing number of execs (see BW Online, 2/04/04,
"Tech Hiring: No Longer an Oxymoron"). Americans aren't getting any younger
-- and they don't seem to be getting much healthier either. But this year,
consulting is making a comeback as businesses call in hired guns to help them
wring more out of still-tame revenues. In the legal field, lawyers with a
background in securities and white-collar crime are in demand as lawsuits
against corporations and mutual-fund firms pile up, to tick off just a few of
the occupations where candidates are likely to get job offers.
To get a sense of this year's employment outlook,
BusinessWeek Online's
Eric Wahlgren asked a number of career experts, including headhunters,
B-school officials, and corporate recruiters, to make educated guesses about the
2004 job scene. Their edited comments follow in Part One of BusinessWeek
Online's fourth annual utterly unscientific career-outlook survey of employment
experts. Part Two will be published on Feb. 10.
Ted Martin, CEO of Martin
Partners, an executive-search firm in Chicago:
|
|
"2004 will see a sharp spike in hiring in the second half of the year"
|
|
Health care continues to be a growth
area. Selective areas of biotech, medical devices, pharmaceuticals, diagnostics,
and managed care continue to grow. The financial-services industry is coming
back with a good deal flow in front of the investment bankers. Nanotechnology is
finally taking off, and after a couple years of promise, it's finally enjoying
significant venture-capital investing.
Finally, engineering services will continue to evolve as will the software
industry. The security industry, including both software and hardware security,
also continues to be hot.
The biggest demand will be for CEOs, CFOs, and CIOs. The biggest change for 2004
is that CEOs no longer enjoy much of a timeframe to prove themselves. There used
to be a rule of thumb that CEOs had at least three years.... In the first year,
they would create their plan. In the second year, they would implement it. And
in the third year, they would execute and measure the results of the plan. This
timeframe no longer holds any validity.
The CIO's role is to tie systems across all areas of the company, and there's no
excuse for failing to deliver timely and accurate reporting through the systems
side. And that holds true for the CFO, who must deliver timely and accurate
reporting, with a big emphasis on the fact that he or she cannot be wrong.
2004 will see a sharp spike in hiring in the second half of the year, barring an
unforeseen global-instability issue. As long as the global instability
continues, the markets remain skittish and the prominent corporations retain a
conservative attitude towards growth.
As far as offshoring goes, the bottom line is, when a consulting firm can
replace a $48,000 hire with an $8,000 hire in India, it's going to be very
difficult for this trend to reverse itself. Not only are you saving $40,000 on
an annual basis per person for a programmer, let's say, but you often are
getting a more qualified and experienced individual than you could in the
States.
The question is, if our college graduates cannot get hired at the entry level
due to offshore hiring, how can they expect to move up to the management level?
Wahlgren writes for BusinessWeek Online in New York
Edited by Beth Belton