April Employment Figures Signal "Back to the Swamps!"
It's time for the U.S. Bureau of Labor Statstics' monthly employment report, and this one shows us relapsing into the status quo that persisted for much of 2012, 2013 and into early 2014 — namely, modest growth, little change in unemployment numbers, and a long, drawn-out haul to make things the way we'd all like them to be. An economy, that is, where new workforce entrants are easily able to find good work and there's no big backlog of long-term unemployed still to be absorbed into the workforce. If that old pattern from previous years, which has now repeated for both March and April for 2015, keeps on going, then the slog to prosperity and party hats is going to take years and years to complete.
As recently as the end of 2014, the employment situation looked like things were finally perking up, with monthly jobs added figures topping 250,000 (and occasionally rising above the 300,000 mark). There were regular reductions in the overall unemployment rate, and along with that excellent trend, the numbers of both short-term and long-term unemployed persons dropped. In March, 2015, we saw the jobs added figure drop below 200,000 for the first time in more than two years, but the unemployment figures stayed put overall.
This month, it looks like more of the same, if not quite as dismal: 233,000 jobs were added in April, and the gross unemployment rate remains at an acceptable 5.4 percent. February's numbers were revised upward slightly (from 264,000 to 266,000) but the weak March numbers dropped substantially — an already low 126,000 was cut by 41,000 to a gosh-awful 85,000). Job gains for the past three months have averaged only 191,000 per month, substantially less than the 280,000 or so average for last year (2014).
Professional and business services maintained its star position in April, with 62,000 jobs added (this sector has averaged 35,000 new jobs per month for February, March and April). Within this sector, computer systems design and related services added 9,000 jobs, business support services contributed 7,000 jobs, and management and technical consulting services gained 6,000 jobs. Construction finally found its "spring swing" as it added 45,000 jobs for April, after staying nearly flat in March. Construction has averaged about 23,000 new jobs per month over the past year, but is always subject to seasonal fluctuations.
Transportation and warehousing saw 15,000 new jobs added. Mining jobs dropped by the same amount for April, with losses in mining (-10,000) and oil and gas extraction (-3,000). Employment in this sector has dropped by nearly 50,000 since January, with most losses in the mining sub-sector. The rest of the sectors appear pretty flat, including manufacturing, wholesale trade, retail trade, information, financial activities, leisure and hospitality, and government. The average work week stayed more or less flat at 34.5 hours, and wages increased by 3 cents per hour to $24.87. Wage growth over the past year has averaged a modest 2.2 percent across all sectors and industries.
Looking to Table A-14, unemployment in the information sector is down to a very low 3.2 percent, but the size of the sector also appears to be decreasing. In April, 2014, information unemployment was 175,000 persons for 5.7 percent of that workplace segment. For April 2015, those numbers were 84,000 and 3.2 percent, respectively. That translates into total information employment of 3,070,000 for April 2014, but only 2,625,000 for pril 2015, which indicates a reduction in the size of the workforce over that period of 445,000 or 14.5 percent of all jobs in the information sector.
This is an interesting and ongoing trend that appears in the U.S. BLS numberd, but doesn't accord with what I'm hearing from hiring managers at IT operations in enterprise, SMBs, research, academia and government. All of those folks tell me they're struggling to hang on to their best IT employees (as you'd expect in a market with very low unemployment like the 3.2 percent reported for April 2015). Many of them tell me that they're planning to add modest headcount later in 2015 to keep up with ever-increasing IT workloads. (For smaller organizations, this usually means 1 or 2 people; for larger ones, it could mean a 1 or 2 percent increase in overall IT headcount.)
What does all this mean for us IT folks? Things continue to improve, but the pace of improvement has apparently slowed down. There should be opportunities for new workers to find jobs, and for more experienced IT pros to make strategic job changes. But it remains important to be careful in choosing one's employment situation, and in seeking to change out of a stable situation, where one might not feel one is doing as well as might be managed somewhere else. It's no longer necessary to hunker down and stay put, but it's still important to weigh one's options carefully, and to take only those opportunities that provide compelling evidence of substantial gain or improvement to come.