For those looking for work these days, job security may be a stubbornly elusive goal.
More than seven million jobs have been lost during this recession, and so far, few have come back. When jobs do return, say experts, many will be temporary, contract or short-term. Risk-averse employers seeking cost savings and flexibility will outsource whatever they can to smaller firms or independent contractors before hiring full-time employees. That means job seekers will have to be more flexible, willing to take short-term assignments or relocate to places where jobs are plentiful. In the days ahead, fewer Americans will be hired by large corporations, and more will have to work at small companies, in guilds of contractors or through self-employment.
In many respects, none of these changes are new.
"The future looks like the past only more so," says Wharton management professor Peter Cappelli. "What happens as a result of these big downturns is that the trends already underway just get speeded up." For example, the percentage of the labor force over 55 years old has grown in the past few years as the baby boom generation aged and decided to work longer. The financial crisis magnified that trend as more boomers delayed retirement in response to their plummeting 401(k)s. In other cases, companies that were planning to trim workers did so quickly instead of gradually. Sectors that were already shrinking shrunk faster. More jobs moved overseas. Ailing businesses failed instead of hanging on.
For job seekers, it won't be easy to figure out where to go next. In its 10-year employment outlook, The U.S. Bureau of Labor Statistics projects that 96% of job growth between now and 2018 will come from service-providing industries, the top sectors being professional and business services and health care and social assistance. Cappelli says such long-term projections aren't worth much to job seekers, however, because people adapt to them the same way investors react to a stock tip -- by flooding the market. "Everyone says there are jobs in health care, but nursing schools have been at capacity for quite a while," Cappelli notes. Likewise, the financial and construction industries are in the doldrums now, but when they recover, they might roar back. "Things flip around as quickly [in the job market] as in the investment industry, but individuals can't flip their careers around so quickly," he adds.
For large companies, the answer probably won't include many full-time positions for college graduates. "My studies show that year after year after year, large employers aren't adding jobs; they're just replacing jobs," says Phillip Gardner, director of the Collegiate Employment Research Institute at Michigan State University. "The most buoyant part, the most consistently positive part of college hiring has been small employers." According to the Institute's latest Recruiting Trends survey, large companies (those with more than 4,000 employees) plan to decrease hiring by 3% in 2010, and mid-sized companies (those with 500 to 4,000 employees) expect to decrease hiring by 11%. However, small companies (with 100 to 499 employees) expect to increase hiring by 15%, and fast-growth companies (from 9 to 100 people) by 26%. These companies span a range of sectors. If small companies are able to get enough credit to keep business going, they could drive job recovery, Gardner says. "We don't have any white knight sector out there like we have had in past recessions. This is going to be an army of ants -- small diverse companies requiring college graduates. They are going to pop up all over the place."
In the meantime, job seekers are taking what they can get, even if it's temporary. Patricia Rose, director of career services at the University of Pennsylvania, notes that 3% of the university's 2009 graduating class took internships, temporary positions or part-time jobs that weren't guaranteed to continue, up from 1% in 2008. Rose believes students have shown more interest in fellowships and short-term opportunities, such as Teach For America, in part because they want a meaningful experience, in part because can't find traditional full-time jobs. Short-term jobs "were not created in response to the recession, but they have become more attractive during the recession because students are considering more options," Rose says.
What is your company doing about hiring temp workers verses fulltime?
