Partner Professional Staffing’s 2012 Employment Predictions

Since 2011 came to a close with a decline in unemployment and positive hiring trends, we look optimistically towards 2012 as a year of growth and economic healing. Through detailed research on current hiring trends and predictions, we have developed our expectations for domestic employment in 2012, including a positive increase in hiring, salary increases, and an influx in hiring of new graduates and those with MBAs. The following are our predictions for the job market in the next 12 months:

Positive Trends in Hiring to Continue
At the end of 2011, we welcomed a decline in unemployment as rates in November reached a two and a half year low at 8.6%. An increase in hiring is expected to continue throughout 2012. One survey of hiring managers shows 20% of both Finance and Technology executives plan to add full-time accounting and finance employees and expand their IT departments respectively. The net increase for Finance and Accounting is 9%, and for IT it’s an expansion of 10%, which represents an increase of four points for both according to a fourth quarter survey.

The consistent positive improvements in the economy, though slow, are what is giving many employers the confidence to increase their hiring in 2012.  According to seasonally adjusted data, U.S. employers have conveyed a steady, positive hiring outlook for nine straight quarters, with those in the Midwest reporting the strongest positive net employment outlook at plus 10%. In comparison, the seasonally adjusted net employment outlook was 7% for the fourth quarter of 2011 and 8% for the first quarter of 2011.

Increase in Wages
In addition to growth in hiring, 2012 could be the year to expect a raise. Business News Daily reports that average salaries are expected to rise by 3.4% in 2012. Jobs in IT are projected to have the largest gains with a 4.5% increase, due to companies looking to expand their capabilities and transition to cloud computing.

Because of an influx in demand for financial analyst and tax accountants, professionals in these areas are expected to see the second highest salary increases. Another report from mlive.com attributes expected salary increases to the declining unemployment rate. The Wage Trend Indicator from BNA, a subsidiary of Bloomberg L.P., signals that based on current market conditions, wages are expected to increase in the first quarter.

Not only will current employees most likely be seeing a salary increase, but so will new hires and consultants as recruiting for skilled talent becomes increasingly competitive. The competition for some skill sets is already very high, causing a shortage of talent that could threaten success and growth for organizations that are not prepared.

Hiring for New Graduates and Professionals With MBAs
A new survey released by the Graduate Management Admission Council is projecting a positive outlook for those with MBAs. Hiring for 2012 is on the upswing, with 74% of employers intending to hire at least one MBA in 2012, up from 58% in 2011. Keeping aligned with an expected increase in salaries for 2012, 32% of companies said they would increase compensation for their new MBA hires. Hiring for new college graduates is also seeing growth. The college-level unemployment rate, which can serve as a proxy for professional employment, was 4.4% (seasonally adjusted) in November. A report from U.S. News shows employers plan to hire 9.5% more graduates from the class of 2012 than the class of 2011. Employers are expressing the greatest interest in business, engineering, and tech-related graduates. The new graduating class will also earn, on average, 6% more than last year’s graduates.

Increased Resignation Rate
Last January, we reported that the resignation rates in 2010 steadily increased by a recorded 20% year-over-year domestically. In 2011, the trend continued, and to compound the issue, about a third of employers said they lost top performers.  This is one trend that we are forecasting will continue throughout 2012. Not only do most employers agree, 43% are concerned they will lose more top talent this year.  Some are predicting turnover at 25% in high-demand areas, mostly because employee retention programs have degraded so significantly in recent years.

According to employees, the most common factors stated for why employees voluntarily left an organization included: desire for higher compensation, the feeling of being overworked and a lack of career advancement.

After another record year, we at Partner Professional Staffing are optimistic about the growth in hiring trends, wage increases, and new hires for 2012. As the economy continues to slowly gain momentum, we are predicting a 12% growth in employment in Technology and 8% or better in Finance and Accounting this year. The steady increase in hiring trends is restoring employer confidence and we are encouraged and excited about business growth in 2012.