In line with recent average monthly gains, the nation added 169,000 jobs in August, and a slight decline in the unemployment rate at 7.3 percent. Much of the job growth this month occurred in retail trade, healthcare, and professional and business services. Retail trade added 44,000 jobs in August, with a total of 393,000 jobs gained over the past year. Employment in healthcare continued to rise, increasing this month by 33,000 jobs, largely within the ambulatory care services sector (+27,000). In addition, employment in professional and business services continued to trend up by 23,000 this month. Over the past year, this industry has added 614,000 jobs.
Widening Skills Gap among Key Professions
A number of reports are pointing to a growing gap in the demand for workers with college degrees and the supply of those who have them, an issue even more prominent within the IT and engineering fields. In an update of its widely-cited estimates, new research from the Georgetown Center on Education and the Workforce, says that at current graduation rates, there will be five million more jobs requiring employees with university degrees by 2020 than people to fill them.
While jobs are booming in the IT sector, hiring managers are struggling to find employees with the right skills and talent to fill these positions. And it appears education is at the root of the skills gap. With 70 percent of the nation’s school children rated “less than proficient” in math and science, it’s fueling a new generation of employees entering the workforce ill-equipped to handle highly specific and technical jobs.
A similar situation exists in the engineering field where, according to the Brookings Institution, America accounts for only four percent of the total engineering degrees awarded globally compared to 56 percent of degrees granted in Asia. Yet, engineering degrees are some of the highest paid out of all bachelor’s degrees, and opportunities in the field are pervasive across the U.S.
Consumer Confidence Dips Slightly, Worker Confidence Continues to Improve
For the first time in many months, U.S. consumer confidence levels mirrored those of worker confidence levels as both improved in August, indicating Americans are growing more optimistic about employment opportunities and the outlook for the economy. The Conference Board’s Consumer Confidence Index increased to 81.5 from a revised 81 the prior month, which was stronger than initially estimated by a Bloomberg survey of economists forecasting 79. The boost in confidence may also be fueled by recent home price appreciation, which increased at the second-fastest pace in seven years.
According to the August Randstad Employee Confidence Index, the American workforce showed an improved outlook across nearly all indices. The report shows increased optimism among workers about both the economy, and their job security with the Index rising 1.7 points to 58.0 this month. Equally impressive confidence levels in the future of their current employer were reported, with 61 percent indicating so. Further, fewer workers indicate they are likely to look for a new job than in July (down four percentage points to 32 percent).
ACA May Help Create a Larger Free Agency Workforce
The temporary and project-based contingent workforce is a critical component of the U.S. labor force, expanding more rapidly than ever. However, the Affordable Care Act (ACA) and its promise to offer access to more affordable health insurance may effectively remove a traditional barrier to choosing a temporary career path, drawing unprecedented numbers to the industry.
Groundbreaking research conducted by Harris Interactive on behalf of Randstad, uncovers evidence to support a greater number of workers opting for temporary employment as more options for healthcare coverage materialize. In fact, with ACA in place, Randstad research estimates that 47.5 million workers could choose to pursue careers as temporary or contractor, making 33 percent of the new U.S. workforce made up of free agents, resulting in several implications for employers across the country.
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