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Helping you to find the employees you need to run your business efficiently. 		 
The Connection

Vol. 1, Issue 2   5/11/2007

How the minimum wage increase affects your bottom line.

Michigan's minimum wage is currently at $6.95 per hour. In July 2007, that rate will increase to $7.15 an hour and again in July 2008 to $7.40 an hour, more than $2 what employees had long been accustomed to. As a result, companies that have been paying entry-level employees a rate close to this may soon notice change in the type of candidates they are seeing in response to their job openings.  As the minimum wage increases, companies need to understand the need to raise their pay in conjunction to attract above minimum wage caliber talent.  In 2005, $8 an hour might have been considered decent pay for entry level work, but by next year it will only be a slight improvement over the bare minimum. Job-seekers will notice this too.

While job seekers have to make some concessions about pay, especially in the new Michigan, offering the bare minimum will likely lead to candidates who only do the bare minimum. To attract capable, competent and willing candidates, companies have to be willing to compensate appropriately for the skill sets they seek. Those that do not are likely to see a large increase in their turnover, as employees who are willing to work for low wages are likely to leave when offered even a slight increase.  

When the economy is in bad shape, businesses are especially interested in saving money whenever possible, but low wages may not help as much as one thinks. The cost of turnover, depending on the type of position, can cost thousands of dollars per employee , completely nullifying any money that may have been saved by their lower pay rate. An increase in wages is likely to significantly reduce the turnover both as an incentive to stay and by attracting more qualified and competent candidates to the job.

Degrees in Demand

Employers plan to hire 17.4 percent more new college graduates from the class of 2007 than they did fromt he class of 2006.  More employers across all sectors - service, manufacturing, and government./nonprofit - are planning to increase hiring.  Service sector employers are predicting an increase in new college hiring of 19.8 percent.  Manufacturers are planning an increase of 9.5 percent, followed by government/nonprofit at 9 percent.

Employers in the South expect the biggest increase, over 25 percent.  Employers in the West plan to increase their hiring by nrealy 23 percent.  In the Northeast employers will increase hiring by 17 percent followed by Midwestern employers at 10 percent.

Which degrees are in most demand?

Top Associate Level Degree

1.       Technology

2.       Engineering

3.       Computer Science

4.       Business

Top 10 Bachelor's Degrees in demand:

1.       Accounting

2.       Business administration/management

3.       Computer science

4.       Electrical engineering

5.       Mechanical engineering

6.       Information sciences and systems

7.       Marketing/marketing management

8.       Computer engineering

9.       Civil engineering

10.   Economics/finance

Top Master's Level Degrees in Demand

1.       M.B.A.

2.       Electrical Engineering

3.       Computer Science

4.       Computer Engineering

5.       Mechanical Engineering

 

Source: HR Blog – Typepad

Staffing Growth Moderates in 2006

America's staffing companies employed an average of 2.96 million temporary and contract workers per day in 2006, an increase of 1.8% over the previous year, according to data released today by the American Staffing Association.

"Staffing firms added just over 50,000 jobs to the economy in 2006," says ASA president and CEO Richard Wahlquist. "However, while temporary and contract employment growth moderated last year to a pace on par with overall employment growth, our members continued to report increased and growing demand for permanent placement and temp-to-hire services."

Based on data from ASA quarterly surveys, the association estimates that America's staffing companies employed a total of 12.4 million temporary and contract workers during 2006, an increase of 300,000 over the previous year. Approximately 4.4 million of those employees secured permanent jobs.

"America's staffing companies help workers find permanent jobs and help businesses find qualified talent. And staffing firms offer work force flexibility for businesses and employment flexibility for employees who prefer flexible work arrangements," Wahlquist says.

U.S. annual sales for temporary and contract staffing totaled $72.3 billion in 2006, according to ASA survey data, surpassing the 2005 sales record by 4.1%.

The survey results show that average daily employment during the fourth quarter of 2006 totaled 3.07 million, down 1.5% from the same period in 2005. Temporary and contract staffing sales in the fourth quarter hit a new high of $18.6 billion, exceeding the previous year's fourth quarter record by 0.7%.

ASA represents the U.S. staffing industry. ASA members provide a wide range of employment-related services and solutions, including temporary and contract staffing, recruiting and permanent placement, outplacement and outsourcing, training, and human resources consulting. Member companies operate more than 15,000 offices across the nation and account for 85% of U.S. staffing industry revenues.

To view historical data from the ASA quarterly survey (1992 to present) or weekly measures of staffing employment, visit americanstaffing.net. Click on Staffing Statistics, then Staffing Employment and Sales Survey or Staffing Index, respectively.

 

Source: American Staffing Association
   
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Diversified Industrial Staffing provides the information in this newsletter for general guidance only, and does not constitute the provision of legal advice or professional consulting of any kind. The information provided herein should not be used as a substitute for direct consultation with a professional staffing service, such as us. The information is provided "as is," with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.