Filling Employment Needs in a Sellers’ Market
October 10, 2018
The economy seems to be chugging along, with unemployment at record lows. The Bottom Line looks at why some of that optimism needs to be tempered and what companies need to do in an increasingly competitive recruitment landscape.
DP: We are hearing a lot about the booming economy and record employment. Just where are we with respect to the unemployment rate?
TS: So right now we're at an 18-year low, at approximately 3.8% and closing in on the 1969 rate of 3.5%. That's particularly impressive given the current atmosphere surrounding international trade deals. In case you haven't heard in the news, the U.S. is imposing a multitude of tariffs, which are essentially a tax on goods – predominantly steel and aluminum – imported into the U.S. The idea is to even the playing field with U.S. products from foreign companies. But this is something to keep an eye on.
DP: I just saw today that the EU slapped a new round of tariffs on us.
Tim Schuster: We're getting into a little bit of a trade war, but it always shakes out.
DP:Without being a party pooper, why should we be cautiously optimistic about these employment numbers?
TS: Interestingly, with the booming economy we're really not seeing an accompanying increase in wages. But as the economy continues to grow, that soon may change. You've probably read in the news over the past few months that there are some major companies that are giving out bonuses to their employees because of the tax reform. While this may be minor, it is a start that they are giving back to their employees. Another factor that may come into play is how unemployment is actually being calculated. If someone has just initially stopped looking for work, that doesn't count toward the statistic, so it's something to really be cautious about when you hear unemployment rates – because other factors that go into it.
DP:Having said that, I saw a CNBC headline the other day that said there are more jobs than people out of work, which I found fascinating. So, how can closely held businesses attract the best and brightest?
TS: They really need to be creative and competitive. It may mean enhancing compensation packages. As a company, you're making investments in your future. So no company has a capital investment mindset of, let me go out and get the most mediocre technology I can find. The same goes for people. You also need to be creative and keep an open mind and that may come down to offering a wellness program or a superior work-life balance. We have that here at our firm. You can work from home, you can work in the office, and you're out at clients. I've also read where some employers are helping pay off student loans. This is a huge plus when trying to attract the millennials to work for your company. A benefit that can help lessen the burden of crippling student debt by offering some sort of agreement to pay back student loans is a wonderful hiring inducement.
DP:Especially when those loans are pretty significant.
TS: High interest rates, unsecured debt – whatever they can do to alleviate that pressure for their employee would be great. And another concept being thrown around is offering unlimited paid time off as an incentive. Clearly there are going to be rules around unlimited paid time off. But there are a lot of companies floating this idea as an incentive package.
DP:What's a good note to end on for our private business listeners?
TS: I did a little research and according to a recent survey by Accenture, 44% of college graduates said that they want to work for a small company or a startup versus only 19% for a big company. This is a huge change if you talked to someone 40 years ago; they worked for one company
DP: They don’t want to go to IBM or Exxon.
TS: Exactly. So you're seeing a shift toward smaller companies, mid-sized companies or startups that are going to really entice these people to work there. So it really pays to take some time to understand the millennial mindset with respect to career trajectory. I have a lot of conversations with my clients who are looking to attract millennials to work for them. This is an area that our Private Business Services Group specializes in. We can help our clients plan out the success of their organization.
DP: Excellent. So give us one of the really neat New Jersey Historical Society Fun Facts.
TS: Of course. This is actually a continuation of a fun fact that we gave a few podcasts ago. New Jersey was, at one point, two separate states. Out of curiosity, do you know how we got our name?
DP: I do not.
TS: Ah, well I'm going to tell you. The land was officially named New Jersey after the Isle of Jersey in the English Channel.
DP: Never knew that. Well thanks, Tim, for this valuable information.
TS: My pleasure.
DP:Thank you for listening to The Bottom Line as part of the EisnerAmper podcast series. If you have any questions or there's a topic you'd like us to cover, email us at firstname.lastname@example.org and visit EisnerAmper.com for more information on this and a host of other topics, and join us for our next EisnerAmper podcast when we get down to business.