October 10, 2017 – For the first time in seven years employers lost 33,000 jobs last month, but the U.S. unemployment rate still fell to 4.2 percent, according to the most recent U.S. Bureau of Labor Statistics report. During September, the number of workers unemployed declined by 331,000 to 6.8 million. Economists had forecast that payrolls would increase by 80,000 jobs last month and that the unemployment rate would stand at 4.4 percent.
A sharp employment decline in food services and drinking places and below-trend growth in some other industries likely reflected the impact of Hurricanes Irma and Harvey.
“The numbers were certainly blown around a lot by the storms,” said Carl Tannenbaum, chief economist for Northern Trust. “As winds calm my guess is employment figures will stabilize.”
Gus Faucher, chief economist at PNC Financial Services Group was quoted as saying that the job numbers will almost certainly rebound. “I don’t think this is indicative of problems in the labor market – it’s because of the hurricanes,” he said. “Excluding effects of the storms, “the economy is in decent shape, the labor market continues to improve, and we’ll bounce back to job growth in the final three months of 2017.”
Where Job Growth Occurred
During the month, job growth took hold in a number of broad industries. Here’s a look at some of the most important key sectors:
- Employment in food services and drinking places dropped sharply in September (by 105,000), as many workers were off payrolls due to the recent hurricanes. Over the prior 12 months, food services and drinking places had added an average of 24,000 jobs per month.
- In September, healthcare added 23,000 jobs, in line with its average monthly gain over the prior 12 months (up 27,000). The employment increase in ambulatory healthcare services (25,000) was partially offset by a decline in nursing care facilities (by 9,000).
- Employment in transportation and warehousing increased by 22,000 in September. Job gains occurred in warehousing and storage (5,000), couriers and messengers (4,000), and air transportation (3,000).
- Employment in financial activities changed little in September (up 10,000). A job gain in insurance carriers and related activities (11,000) largely reflected hurricane-recovery efforts. The gain was partly offset by losses in activities related to credit intermediation (down 4,000) and in commercial banking (3,000). Over the year, financial activities has added 149,000 jobs.
- In September, employment in professional and business services was little changed (up 13,000). Over the prior 12 months, job growth in the industry had averaged 50,000 per month.
- Manufacturing employment was essentially unchanged in September (down 1,000). From a recent employment trough in November 2016 through August of this year, the industry had added an average of 14,000 jobs per month.
- Employment in other major industries, including mining, construction, wholesale trade, retail trade, information, and government, showed little change over the month.
U.S. Employers Expect More Hiring for Remainder of 2017
A record number of hiring managers in the U.S. anticipate bringing aboard more employees in the next six months, according to the semi-annual hiring survey from DHI Group, an online career resource and talent acquisition platform for technology professionals and other select professional communities.
One area likely to continue to show promise for job seekers well into the future is cybersecurity. Data from CyberSN, a Boston-based staffing and recruitment firm, shows that vacant cybersecurity jobs remain open for an average of six months before a company engages a search firm or staffing agency.
Meanwhile, the cybersecurity industry is short millions of professionals, said CyberSN founder and CEO Deidre Diamond. A recent report from Booz Allen Hamilton, a consulting and services firm, and the Center for Cyber Safety and Education forecasts “a worldwide shortfall of 1.8 million cybersecurity workers by 2022, an increase of 20 percent from the group’s previous shortfall prediction made in 2015.”
Additionally, more than 80 percent of the cybersecurity positions surveyed by CyberSN were hired at a salary higher than the initial salary budget, said Ms. Diamond. “This tells us that despite overall job losses, cyber security jobs are still growing, cyber salaries are on the rise and organizations are trying to fill these positions themselves,” she said. “All of this equals major risk.”
What Sectors Are Hiring
U.S. employers in all sectors expect hiring to pick up in the final quarter of 2017, with 21 percent planning to add staff between now and December. According to the latest ‘Employment Outlook Survey,’ released by ManpowerGroup, employers in all 13 national industry sectors expect to grow staffing levels during the final quarter of 2017: Leisure & hospitality (+28 percent), professional & business services (+22 percent), wholesale & retail trade (+20 percent), durable goods manufacturing (+18 percent), transportation & utilities (+18 percent), construction (+16 percent), education & health services (+13 percent), financial activities (+13 percent), information (+13 percent), nondurable goods manufacturing (+13 percent), mining (+13 percent), other services (+13 percent), government (+12 percent).
When compared with the third quarter of 2017, employers report slightly stronger hiring prospects in four industry sectors nationwide: Construction, leisure & hospitality, other services and professional & business services. For two of these sectors – other services and professional & business services – hiring intentions are stronger than at any point since they were first analyzed nine years ago. In addition, employers in durable goods manufacturing reporting the strongest intentions in the past 10 years.
“Technological disruption is transforming manufacturing into a high-tech, high-skilled industry,” said Michael Stull, senior vice president, Manpower North America. “At the same time, demand for ‘Made in America’ continues to grow and organizations are stepping up their manufacturing efforts here on U.S. soil.” From New York to New Mexico, he said, manufacturing companies are looking for increasingly specific skills.
“That’s why we’re working with companies like Rockwell Automation to build the right-skilled advanced manufacturing workforce to help fuel America’s growth,” he said. “Other sectors would do well to follow the upskilling trend – the skills of the future will look very different from today. We can’t afford to wait and see exactly what these skills might be. We need to build the plane while flying it too.”
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; Stephen Sawicki, Managing Editor; and Will Schatz, Managing Editor – Hunt Scanlon Media