Hiring Decisions Put on Hold - Business Belt Tightening Raised Productivity

Companies have cut their head-count to the bare bone to survive The Great Recession. This has actually improved their productivity - nationally rising by 6.2% in the fourth quarter. So when will they begin to hire again? Many, after squeezing more output from their existing workforce, are downright paranoid about adding new positions because of a lack of confidence in the sustainability of the recovery.

Let's face it, American businesses have gone through a painful experience, just to weather the economic downturn, and are understandably reluctant to add new employees. Especially when they discovered they could do more with less - less employees that is. What does this do to the current job market?

The Labor Department released the latest (estimated) unemployment number of 9.7% - a slight decrease from 10% at the end of last year. But, at the same time, they revised the number of jobs lost last year upward by 930,000. Since the beginning of the recession, the number of jobs lost has also been revised from 7.2 to 8.4 million. The Labor Dept. unemployment percentage doesn't take into account the 6.3 million long-term unemployed who have expended benefits nor the discouraged workers who have given up looking. Labor experts believe the "true" rate of unemployment is now 16.5%. Most don't expect the problem to get better any time soon. It is estimated that there are an average of 6 people searching for each available job opening.

We are in a classic Catch 22 situation: with 70% of our economy driven by consumer spending, we must see the demand for goods and services increase where businesses will be stretched beyond existing capacities. They will have to hire additional employees to keep up with the new demand. But that could be a slow process with almost 1 in 5 workers unemployed - most likely eliminating any discretionary consumer spending, which our system is so dependent upon.

Workers can only be pushed so far before the added stress of more hours and higher production rates takes a toll. It has been argued that the left-behind workers, who have been forced to take on added workloads of the workers laid off, have it the roughest. They are forced to work longer and harder causing stress - leading to depression and even physical illness. Not only are they stretched near the limit, the "unknowns" of their jobs possibly being cut next adds to the stress, and can be debilitating.

If employed in a company pushing you to the limit, you must begin a dialog with your manager that you are giving your all - but it cannot go on forever. The company has kept you around for a reason - perhaps you have become the "go to" person, as well as performing your job well. This certainly will help solidify your position, but should also give you the respect to yell "uncle" when the workload becomes too heavy.

Unemployed and looking at a company from the outside, first do your research on the company and determine it is a good fit for you. Use your network to connect with someone (or someone who knows someone) inside the company that interests you. Find out if they are stretching their employees to the limit or preparing to hire from the outside. You might even suggest doing some contract work for them, so they can keep up with their demand without the long-term risk of adding full-time employees in this time of uncertainty. This will give them exposure to you and your set of skills - and gives you a peek into their culture, management style, and the long term viability of the company. It can be a win-win situation.

Richard S. Pearson is the Author of 5 Necessary Skills to Keep Your Career on Track. He has held vice-president positions with four multibillion dollar travel industry companies and three Internet early stage companies. He has a BA degree from Regis University in Organizational Development. His experience has given him a unique perspective on how to navigate the organizational structures of both large and small companies. He has hired and trained hundreds of employees from frontline salespeople to vice presidents, and coached many through their careers. He is currently working on facilitating the large increase of travel between the US and China, which is taking place. http://www.5necessaryskills.com

Jobless Recovery - An Oxymoron - the Depth of Unemployment in Perspective

The widely-used buzzword, "jobless recovery", is the ultimate oxymoron. There is no recovery without the creation of new jobs. Seventy-percent of the US economy is consumer driven and if unemployment remains high, consumers will hold back on purchases. Consumers stick to the staples if they are marginally employed, unemployed, or in fear for the stability of their own jobs.

We get so jaded by enormous numbers tossed around the media these days from bank bailouts, stimulus packages, the national debt, etc. - seeing trillions, billions, or millions of something or another that we totally lose perspective of the size and scope of things. Let's put "real numbers" to the human side of unemployment. Each week just about one-half million people file for FIRST TIME unemployment benefits. To put that in the proper frame of mind, this is roughly the population of cities the size of Boston or Denver proper. It is difficult to fathom the numbers and human misery as a result of job loss. But think of every man, woman, senior citizen, and child in Boston - that number of people - losing their job each week. Now think of two very populous US states, Illinois and Ohio, about 25 million people combined. That is roughly the number of people on the unemployment rolls and those men and women who have expended their unemployment benefits and given up on finding jobs in this tough job market. The best estimates put this number at 17% of the total US workforce, not the 10% or so published by the Dept. of Labor, which is only the number currently receiving unemployment benefits. Again, contemplate the entire populations of these two populous states, not just the working age folks, but the entire populations -- out of work! This is mind-boggling! And these people are not buying new cars, flying to Florida for Spring break, or remodeling their spare bathrooms.

The American Recovery and Reinvestment Act of 2009 (ARRA) has created some new jobs, but at a high price of $800 billion (yes, that's billion with a B) - and future generations will (unfortunately) be picking up the tab. The number of jobs saved and created has not met the Obama administration's projections, so Congress has proposed another stimulus package - throwing more good money (which we have to borrow from other countries) after a marginally successful program. Now our government, in its infinite wisdom, has decided to count the jobs created differently. "The White House says it will no longer keep a cumulative tally of jobs created and saved by the stimulus. Instead, it will post only a count of jobs for each quarter. And instead of counting only created and saved jobs, it will count any person who works on a project funded with stimulus money-even if that person was never in danger of losing his or her job." On this last point, one of the stimulus programs funded required the purchase of 3000 vehicles from Chrysler. The workers who build these vehicles along with tens-of-thousands of others will be counted as new jobs, even though they were employed before this order and will remain employed after. And some of the stimulus money was used to give pay raises (unbelievable how that can be justified). Then there is the $247,000 spent on road signs in Colorado, stating particular projects were funded by ARRA. I would have rather seen that money spent on hiring 5 full-time workers!

So here we sit in a recovery-less, jobless recovery, wondering what the future will bring.

Richard S. Pearson is the Author of 5 Necessary Skills to Keep Your Career on Track. He has held vice-president positions with four multibillion dollar travel industry companies and three Internet early stage companies. He has a BA degree from Regis University in Organizational Development. His experience has given him a unique perspective on how to navigate the organizational structures of both large and small companies. He has hired and trained hundreds of employees from frontline salespeople to vice presidents, and coached many through their careers. He is currently working on facilitating the large increase of travel between the US and China, which is taking place. http://www.5necessaryskills.com