Winter, Wyman News & Views: Job Market Outlook for Summer 2010

What a difference a year makes. This time last year, organizations were preparing for the perfect storm — a collision of economic, market and financial factors that would collide to create a recession like no other. Many companies responded by cutting staff, instituting hiring freezes, halting spending and making severe cutbacks. They readied their organizations as best they could to survive the economic crisis. Without a doubt, it has been a turbulent year, but we are beginning to see the sun peek out from behind the dark clouds.

In fact, certain economic indicators suggest that this downturn may not have been as bad as anticipated. It doesn’t seem to have lasted as long as some pundits predicted, and we are positioned to rebound more quickly than we did from the dot com bust last decade. While we still have to wait to see if the recession is officially over, the outlook looks good for the economy and, more specifically, the job market.
Winter, Wyman, as a staffing firm, is in a unique position to take the pulse of the hiring market. In fact, we serve as a microcosm — or bell weather — of the overall economy. When the economy is shaky and companies cease hiring, our business is down. Conversely, as organizations gain confidence and look to add to the workforce, our business picks up. So far this year, we’ve seen an across-the-board increase in hiring in nearly every specialty area we serve in both permanent and contract positions. The second quarter of 2010 has seen the largest spike yet.

One reason we may be seeing this increased movement in the job market is because of geography. Here in the Northeast, we were better poised to recover from this economic dip because this area of the country is dominated by industries that have weathered the economic crisis better than most. This region is prolific with healthcare, software technology and biopharmaceutical companies, which have largely remained healthy over the past couple of years. Even financial services firms, which suffered a major wallop during the stock market crash, are showing signs of recovery. These strong industries will continue to help the Northeast pull out of the recession before the rest of the country.

Just 18 months ago, there was doom and gloom in the air. Among business leaders and employees everywhere, the fear was palpable. Of course, the forecast was that this recession would be the worst since the Great Depression. But it looks as if that all-consuming fear may have been an overreaction — the downturn doesn’t seem to be on par with the economic turmoil the country experienced in the 1930s. As such, the fear among business leaders is starting to ebb.

Organizations are still a little hesitant, but they are starting to feel more confident. There is a sense that we are not completely safe, but that constant feeling of foreboding is gone. Hiring is picking up as companies slowly start to rebuild their workforces. There is healthy competition among companies for talent, as well. Many organizations that have not been hiring are starting to feel like they need to keep up with other companies. They are also experiencing the pain of low staffing and are straining to keep up with the workload with a pared-down workforce. And many are now feeling some relief from the cash-strapped state of doing business over the past couple of years — and have some leeway to hire once again.

As a reflection of businesses’ building confidence in the economy, Winter, Wyman has seen growth in nearly every industry we represent from IT to Accounting to Human Resources. We have seen dramatic increases in hiring in the second quarter of 2010 compared to the same time in 2009. Here are the numbers:

Direct Hire 

Accounting and Finance — Boston: increase of 11%
Accounting and Finance — New York: increase of 16%
Investments/Financial Services: increase of 24%
Human Resources: increase of 14%
Information Technology — Boston: increase of 44%
Technology — New York: increase of 129%
Software Technology: increase of 63%

Contract Hire

Financial Contracts — Boston: increase of 11%
Financial Contracts — New York: 0% change
Human Resources Contracts: increase of 14%
Technology Contracts — Boston: increase of 45%
Technology Contracts — National: increase of 109%

All of these numbers look promising. There is also an increase in demand for positions in internal recruiting. This indicates that companies are anticipating doing their own rounds of hiring in the future, which bodes well for the overall job market moving forward.

Another interesting and hopeful sign is that we seem to have recovered from this economic downturn more quickly than expected. While we prepared for this recession to last for many months, and even stretch into years, it appears that its lifespan is, thankfully, shorter. In fact, here at Winter Wyman, we took more of a financial hit from both the dot com bust and the downfall after 9/11 than from the recent economic slump. Last decade, after the dot com bubble burst, it took our firm 11 consecutive quarters to reverse our negative trend. That time was shortened to five quarters for this recession — and we have had three consecutive positive quarters to reinforce this trend.

While we are still not sure what the future holds, the outlook for the job market is positive. Companies are hiring once again. If we can continue this steady growth, the Northeast and the rest of the country will be headed for smooth sailing.

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