Counselor Commentary: Where The Jobs Are
Now's The Time To Hire Bright, New Employees
Looking for an economic headline for this week? Try this: Job numbers disappoint. That was the tone for many websites and newspapers yesterday after payroll processing firm ADP reported that private U.S. companies hired 218,000 workers in July. The gain marked the fourth straight month of job increases greater than 200,000, but the numbers fell short of economic analyst expectations of 230,000 new jobs.
“The July employment gain was softer than June, but remains consistent with a steadily improving job market,” said Mark Zandi, chief economist at Moody’s Analytics. “If current trends continue, the economy will return to full employment by late 2016.”
Late 2016? You would hope by now – five years removed from the recession that stole millions of jobs from the U.S. economy – we wouldn’t need to wait yet another two years before we reached full employment. And yet, here we are.
One of the main reasons for the continued employment shortfall is that skittish companies are still stocking away cash like they’re saving for the wettest of rainy days. The Association for Finance Professionals reported recently that U.S. companies raised more cash in the second quarter of 2014 than they did in the first and they also spent money at a slower rate.
The Washington-based group, which represents corporate treasurers worldwide, said its index of quarterly cash holdings rose to 12 points in the latest quarter from four in the previous quarter, due to stronger operating cash flows. Further, a measure of how aggressively treasurers invest cash fell from 10 points to two. The organization concluded that the data signals that “companies had become more conservative in their short-term investments.”
And, while adding new employees is more of a long-term investment than a short-term one, the point is clear that companies are willing to make do with their current employment levels, rather than add new people to try to capitalize on growing opportunities. Yes, the GDP expanded at an impressive 4% rate in the second quarter, but job growth is lagging behind.
Now is the time to add people. The economy is on more solid footing, clients are improving their spending, and markets like health care, education, and technology are growing at impressive rates. There’s plenty of business to be had, but ad specialty companies need enough people to be able to take advantage.
Are you content with the growth you have today, or would you rather outshine the competition by hiring bright, new employees who could make a major impact on your operations? The latter is the way to go.