More Competition for Talent Is Leading to Rise in Wages

7/19/2017

 

Nationwide studies reveal that the U.S. labor market remains bullish about hiring through the second half of the year, and a significant percentage of employers anticipate offering higher starting salaries for new employees.
 

CareerBuilder's 2017 Midyear Job Forecast shows that 60 percent of employers plan to hire full-time employees from July through December, up from 50 percent at this time last year, and 46 percent plan to hire temporary or contract workers, up from 32 percent in July 2016. CareerBuilder also found that 27 percent of workers plan to change jobs by the end of the year.

The survey was conducted between May and June among 2,369 hiring managers and human resources professionals and 3,462 full-time, private-sector employees.

"Most employers remain confident in their outlook for financial growth and plans for hiring," said Matt Ferguson, CEO of CareerBuilder. The growing competition for talent is placing job seekers in a more advantageous position, he added.

"Job seekers stand to benefit from having more options … Employers are moving quickly to recruit candidates and they are willing to pay more across job levels. They are also placing a greater emphasis on candidates having a positive experience when they apply to their firms."

The latest Manpower Employment Outlook Survey, released by ManpowerGroup, a global HR consulting firm headquartered in Milwaukee, supports the CareerBuilder findings, indicating that U.S. employers expect the hiring pace to remain positive in the third quarter of 2017. The survey of 11,000 employers showed that 24 percent plan to hire between July and September, a 2 percent increase from a year ago. Four percent of employers expect workforce reductions, and 70 percent expect no change in staff levels. The remaining 2 percent are undecided about their hiring intentions.

"Employers across the country are optimistic but don't want to get ahead of themselves," said Michael Stull, senior vice president, Manpower North America. "In most sectors, employers report relatively stable hiring plans with some upticks—most notably in durable goods manufacturing, where there are the strongest hiring intentions in more than nine years."

According to the CareerBuilder results, certain industries are expected to match or exceed the national average for adding full-time head count in the second half of the year. Information technology employers are likely to lead the way, with 72 percent planning to increase staff size, followed by employers in manufacturing (66 percent), health care (64 percent) and financial services (62 percent).

Employers in the Manpower forecast showed strong hiring intentions in the leisure and hospitality field, followed by transportation, wholesale and retail, and professional business services. "Technological disruption is rapidly changing skills needs, especially in manufacturing as the marketplace transitions from typical labor to more advanced roles," Stull said. "To keep up, we're seeing employers increasingly invest in training and development programs so people can learn while they earn."

Employers told CareerBuilder that the most in-demand roles they will be recruiting for throughout the remainder of the year are those tied to:

  • Skilled trades (15 percent).
  • Software as a service (14 percent).
  • Cybersecurity (13 percent).
  • Sales enablement (13 percent).
  • Talent management (13 percent).

Both surveys show positive hiring outlooks across U.S. regions, with the West topping the national average in the percentage of employers expecting to hire full-time staff this year.

According to Manpower, the strongest job prospects at the city level are expected in Grand Rapids, Mich.; Raleigh, N.C.; Charlotte, N.C.; Colorado Springs, Colo.; and Des Moines, Iowa.

It's not just enterprise organizations doing the hiring. Midsize firms are leading in the percentage of employers hiring, while small businesses are reporting the biggest year-over-year growth, according to CareerBuilder.

HR Feeling the Pressure to Raise Wages

Over 70 percent of HR managers told CareerBuilder that they will have to start paying higher wages due to an increasingly competitive labor market.

Among all employer respondents—hiring managers and human resources managers—53 percent report they plan to offer higher starting salaries for new employees over the next six months, with 32 percent planning to increase starting salaries on job offers by 5 percent or more.

 
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