Tag: labour market

ManpowerGroup Q1 revenue falls, outplacement activity increases

ManpowerGroup Inc. (NYSE: MAN) has released their Q1 earnings report, revealing a 2.2% decline in revenue in constant currency or 7.6% on a reported basis, totaling $4.75 billion. The decline in revenue was attributed to a challenging operating environment in the US and Europe, despite labor markets remaining strong. Chairman and CEO Jonas Prising noted that employers are being more selective with new hires and focused on retaining their existing staff. ManpowerGroup will continue to adjust their cost base in areas where demand has decreased.

The company’s gross margin improved due to strong pricing discipline and increased outplacement activity in their Right Management business line. In terms of revenue by region, US revenue fell 13.4%, while revenue across Europe fell on a constant currency basis with the exception of France where it rose 2.5%. Revenue in the Asia Pacific Middle East operations increased by 7.3% in constant currency.

Looking at earnings by business line, the Talent Solutions segment, which includes ManpowerGroup’s Right Management and outplacement operations, fell 1% year over year on an organic, constant currency basis but was up 1% on a reported basis. The Manpower and Experis operations saw declines in revenue of 1% and 5%, respectively.

For Q2, ManpowerGroup forecasts a total revenue decline between 2% and 6%, with a decline of 8% to 12% in Americas revenue and declines ranging from 3% to 8% in Europe. Asia Pacific Middle East revenue is expected to be flat to up 4%. The company expects a gross profit margin between 17.9% and 18.1%.

ManpowerGroup’s shares were down 5.92% to $74.80 and the company’s market cap was $4.04 billion, according to FT.com.

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US nonfarm employment increases as temp jobs decrease.

According to seasonally adjusted data released today by the US Bureau of Labor Statistics, the number of temporary help services jobs in the US decreased by 10,700 in March to nearly 3.05 million. However, total nonfarm employment increased by 236,000 in March, with the total number of jobs at almost 155.6 million.

Barry Asin, the president of Staffing Industry Analysts, stated that slower gains in overall employment suggest that the Fed’s strategy to cool the economy is working. Despite the ongoing tightness in much of the labor market, it is encouraging to see growth in the labor force and the highest level of labor force participation since the start of the pandemic. Meanwhile, the decrease in temporary help employment is consistent with slower growth for the labor market in the future.

Today’s data shows that the temp penetration rate, which is the percentage of temp jobs in total employment, fell to 1.96% in March from 1.97% in February.

Over the past six months, the US had an average monthly gain of 334,000 nonfarm jobs. The agency noted that in March, employment continued to trend upward in leisure and hospitality, government, professional and business services, and healthcare.

The BLS revised down the previous nonfarm job numbers reported in January and February, with 17,000 fewer nonfarm jobs and 2,100 fewer temp jobs combined.

In March, the unemployment rate decreased to 3.5% from 3.6% in February. Meanwhile, the college-level unemployment rate remained at 2.0% in March, unchanged since January.

The average hourly earnings for all employees on private nonfarm payrolls increased by nine cents to $33.18. For production and nonsupervisory employees, the increase was also nine cents to $28.50.

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Overall unemployment rate falls to 2.1%

According to research conducted by Singapore’s Ministry of Manpower, the labour market improved in 2022 as compared to 2021. The unemployment rate declined, with the overall rate dropping from 2.7% in 2021 to 2.1% in 2022. The resident unemployment rate also fell from 3.5% to 2.9%, and the citizen unemployment rate decreased from 3.7% to 3.0%. These rates were all below pre-pandemic levels.

Total employment witnessed a significant increase of 227,800 in 2022, a record high that brought the total employment level 2.9% above the pre-pandemic 2019 level. Resident employment saw steady growth, with an increase of 26,300 in 2022, primarily in sectors like financial services and information & communications. By December 2022, the resident employment level had exceeded 2019’s level by 4.8%.

Non-resident (foreign) employment was responsible for the majority of the increase in total employment (201,600), with Work Permit Holders (WP+) hiring in sectors such as construction and manufacturing. This increase was primarily due to the significant relaxation of border controls in April 2022, allowing employers to fill positions left vacant during the pandemic.

Despite an increase in the last two quarters of 2022, the total number of layoffs for the year (6,440) was lower than pre-pandemic levels, with business reorganisation/restructuring being the primary reason for layoffs. The percentage of dismissed residents who found employment six months after being laid off increased to 73.1% in Q4 2022, the highest since Q2 2015 (73.6%).

However, the Ministry warns that global economic headwinds and slower growth may impact labour demand going forward, and employment growth is likely to ease from the increase in 2022 and be uneven across sectors. Nonetheless, hiring sentiments remain positive, according to December 2022 data.

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Data reveals a slowdown in hiring in May and June

A recession may become a reality sooner than expected, suggests new data from the Association of Professional Staffing Companies (APSCo). The research reveals difficulties in the UK’s labour market.

Traditionally, June showed a recruitment spike ahead of seasonal drops in July and August. This year, however, although numbers improved slightly in May, the latest research showed a slowdown in hiring between May and June, suggesting further drops in the summer months.

APSCo’s June research suggests that the economy is feeling the effects of Government uncertainty, a cost-of-living crisis, and substantial skills shortages.

According to the report, the number of permanent vacancies added dropped by 12% month-on-month in June, and the number of contract positions fell 11% year-on-year. It appears that permanent roles are on a downhill trajectory, down -2% between June 2021 and June 2022. Contract roles, however, increased 5% in this period.

Compared to pre-pandemic data, the number of permanent jobs being created dropped by 9% between June 2019 and June 2022, suggesting that the stability of the country’s hiring market and the economy is taking strain.

The report also revealed that placements dropped month-on-month for contract (-9%) and permanent roles (-7%). In terms of permanent salaries, the report showed a 2% increase month-on-month, but -3% decline, year-on-year.

Ann Swain, CEO of APSCo, comments: “A slowdown in hiring following the post-pandemic boom was to be expected, but in the current market and with talks of a potential recession in the pipeline, this decline is of concern. The UK’s post-COVID economy has been hit with employment strikes, skills shortages, Government uncertainty and a cost-of-living crisis. With controversial changes to rules around using agency workers during strikes voted in and the country facing continued uncertainty alongside Governmental leadership changes, employers and the recruitment sector have been hit hard. Stability is crucial as we continue to navigate such an ambiguous market. As the trade body for the professional recruitment sector, we believe that there is more to be done to make the UK’s employment sector competitive on a global scale. With recruitment activity slowing, we could be at a tipping point that sets the country on a downward trajectory unless swift action is taken.”

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The rise in job ads speaks to increased strength in the labour market

According to data from ANZ Bank, job advertisements in Australia rose by 18.4% in June 2022 on a seasonally adjusted basis when compared to the same period in June 2021. This pattern of online job postings is being seen across the globe as skills shortages continue.

On a monthly basis, job ads increased 1.4% in June following a small upward revision of the May number. The total number of job ads in June exceeded the recent peak in March signalling continued strength in the labour market.

When compared to January 2020, job ads were up 58.9% while the number of job ads totalled 243,523 in June 2022.

Catherine Birch, ANZ Senior Economist commented: “Growth in demand for labour is still outpacing supply but the sheer volume of unmet labour demand suggests underutilisation will keep falling and stay low even as demand growth is curtailed by higher inflation and rising interest rates. The very tight labour market is a key reason why we expect the Australian economy will be resilient in the face of these.”

The Bank’s job ads data is based on information provided by the operators of Seek.com.au and the Department of Education, Skills and Employment’s Australian JobSearch site (Jobsearch.gov.au).

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Recruitment sector among the fastest growing industries for entry-level roles

New data from LinkedIn has found that demand for recruiters is soaring in the UK. With the tightening labour market, LinkedIn’s data indicates that 2.9x more recruiter jobs were advertised on the professional networking site in April 2022 compared to January 2019.

The same trend has been noted across Europe during the same period with:

  • Germany (5.9x)
  • France (4.3x)
  • Spain (4.2x)

The recruitment industry is a great opportunity for entry-level talent. LinkedIn’s data regarding the fastest growing industries for career starters in the UK shows that the Staffing & Recruiting sector has grown by 65% year-on-year (2020-2021) for entry-level roles.

LinkedIn’s data showed that the fastest-growing entry-level roles in the UK were Recruitment Resourcer and Human Resources Administrator. Roles such as these require candidates with strong people skills, including sourcing, interviewing, and executive search.

Adam Hawkins, Head of Search and Staffing, EMEA & LATAM, at LinkedIn, commented: “It’s great to see that recruiters are in such high demand as the recruitment industry continues to play a vital role in helping businesses navigate a challenging economic and hiring environment. It’s a fantastic profession, particularly for those starting out in their careers, and presents endless opportunities for skills development.

In the UK, we’ve recently seen job adverts outnumber the amount of people unemployed for the first time since records began. As companies struggle to source the skills they need to succeed, recruiters will be more relied upon than ever to advise companies on how they can open up new talent pools and attract top talent.”

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ONS stats show increase in economic inactivity

The latest figures from the ONS have been released and what stands out is that even though average pay rises for the first quarter are at an average of 4% (excluding bonuses), this appears well below inflation. However, in real terms (adjusted for inflation), growth in total pay was 0.4% and regular pay fell on the year at negative 1.0%. Strong bonus payments over the past six months have kept recent real total pay growth positive but employers may find it even harder to retain talent through salary increases alone as the cost-of-living crisis continues in the UK.

The latest Labour Force Survey (LFS) showed that for December 2021 to February 2022 the employment rate remains unchanged on the quarter, while the unemployment rate decreased. Over the same period, the economic inactivity rate has increased slightly which signals a slight dip in the economic rebound following the end of the pandemic with inactivity increasing by 0.2 percentage points to 21.4% from December to February 2022.

There was a noteworthy increase, albeit small, in the number of payrolled employees for March 2022 which is up 35,000 on the revised February 2022 to a record 29.6 million.

The report showed that once again, the number of job vacancies in January to March 2022 rose to a new record of 1,288,000, with the rate of growth in vacancies continuing to slow down.

Jon Keeble, employment partner at DWF commented on the latest report: “The latest ONS labour market figures demonstrate continued resilience in the labour market. The highlights for the period between December 2021 and February 2022 show a largely unchanged employment rate of 75.5%.

“With legal requirements largely removed across the UK and a shift over to personal responsibility we are very much in the phase of having to live with COVID-19. Although employers are now faced with a number of practical challenges as we enter this next chapter, the relaxation of restrictions should have a positive effect on the labour market.

“We are yet to see what impact the cost-of-living crisis will have on the labour market and whether the Chancellor’s Spring Statement and the rise in the National Minimum Wage will provide sufficient support.  Undoubtedly, employees who are struggling to cope financially will be seeking out those employers, which are able to provide the most attractive rewards package.”

James Reed, Chairman of Reed.co.uk, also commented: “The economy is facing a crunch point as businesses contend with serious challenges, from rapidly rising inflation to severe labour shortages. The jobs boom that began last year continues to be reflected in the ONS’s labour market statistics. With job postings on Reed.co.uk in March increasing 18% year-on-year and 14% month-on-month, this trend shows little sign of slowing. But with economic growth now as low as 0.1% and unemployment at historic lows, the jobs boom is in danger of becoming a jobs overload.”

“The difficulties businesses now face in hiring staff, are having a knock-on effect on supply chains, production output and the quality of goods and services. This is slowing the UK’s economic recovery from the pandemic.

“There are now 8.8 million people who are economically inactive in the UK, which is 600,000 more than at the start of the pandemic. This is a symptom of what I call ‘The Great Lie Down’, with many workers leaving the workforce altogether, some through long term sickness and others preferring early retirement or different lifestyle choices. If these workers are to be coaxed back, they will need convincing with attractive employment arrangements, higher wages and better conditions and benefits.

“Currently, less than 20% of these people who are economically inactive say they would like a regular, paid job. However, if it was possible to help this group find work then that would be of great benefit to both them and the economy.”

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