“We are still swamped with requisition orders,” Jim Lanzalotto, vice president of Yoh, a talent and outsourcing services provider, said after the labor report was released Friday, April 4. “I checked all of our numbers this morning to make sure I wasn’t losing my mind.”
Lanzalotto said the labor market outlook will depend on the sector.
“There are areas, such as biosciences and engineering, where unemployment rates are in the 1 to 2 percent range,” he said. “Companies just can’t get their hands on this type of talent fast enough.”
March marked the third consecutive month of job losses, according to the BLS report, and it’s a clear sign the labor market is feeling the impact of a contracting economy, said Bart Van Ark, vice president and chief economist at the Conference Board in New York.
Van Ark is projecting not a deep recession but a prolonged economic slowdown, which could mean sluggish labor market conditions persist for several more months.
“It took us a long time to get to this point,” he said. “I don’t think a speedy recovery is in the cards.”
The fact that jobs were shed did not come as a surprise, Van Ark said. What caught many people off guard was the spike in unemployment, which climbed from 4.8 percent to 5.1 percent—the highest monthly increase since September 2005.
Because labor conditions are so varied from one industry to another, it behooves employers to increase communication and transparency with workers during such a tenuous time, said Manny Avramidis of American Management Association, a training and development provider in New York. This may mean holding conferences or requiring managers to meet with employees to explain how a company is doing.
Avramidis said opening the lines of dialogue is most critical with rank-and-file workers.
“Managers will be more or less in the know of where they stand on their jobs,” he said. “But the little guy can get easily spooked from what he sees in the media and decide to leave without reason.”
Companies that anticipate reductions in staff need to take further action.
“They better make sure that their succession plans are solid,” Avramidis said. “It will help them make smart reduction decisions.”