The greatest challenge facing many businesses in 2018 will be the shortage of applicants seeking jobs. “Now Hiring” signs are posted in windows, “Now Hiring” banners hang from the fronts of stores, recruitment ads appear on company websites, recruiting websites, job boards and in various media.
The share of Americans either employed or actively looking for work has shrunk to 62.7% from 66% in 2007, the beginning of the 2008-09 economic downturn. The reason for the decrease is still up for debate. While reasons are unclear, the trend is definitely a troubling one. There was a 20% decrease in men’s workforce participation and a 25% decrease in women’s workforce participation between 1999 and 2015.
There is no doubt that the unemployment rate is low in many places and the unemployment rate for us in San Luis Obispo is extremely low at 3.7% (9/17). Five % unemployment is sometimes referred to as full employment so 3.7% makes quite a statement!
Wages have remained stagnant despite unemployment reaching new lows. Minimum wage increases in California will likely result in higher wages for low to mid-level positions. This may entice some to reenter the workforce.
The “skills gap” is likely to be a continuing problem. Finding highly trained workers to fill specialized positions is particularly difficult. Manufacturing companies have found this particularly an issue as more manufacturing jobs require intermediate computer training.
Companies will need to take a serious look at wages for 2018 and beyond. Wages may need to increase in order to hire and retain the skilled workers needed to grow businesses. Companies will also need to consider hiring workers who do not have all of the desired skills, but have some skills and good potential.
This bodes well for the temporary staffing industry. The “try the employees out before making a long-term hiring decision” may be the key to hiring the employees you need in 2018!