The Friendly-Factor – Keeps the workforce
The Friendly-Factor
Creating a work environment that attracts and keeps the workforce
By Greg Smith
In many industries today, jobs are going unfilled. It should go without saying, if you cannot attract and keep your workforce, then you must change what you are doing or face the consequences.
Take your pick.
Which type of place do you want to work at: one that is cold and gives you a sense no one cares, or one that makes you feel good and appreciated? Money and benefits are important, but studies show that in the long run, the work environment — the feeling they get when they come to work — is more important in retaining and motivating people.
People like a friendly place to work.
The friendly-factor does not require a large investment and expense, but it does require time and thoughtful consideration. Take for example a construction equipment dealership in Louisville, KY. Their turnover is almost nonexistent. This is quite an accomplishment in an industry facing massive talent shortages.
Their employees and service technicians share in a profit-sharing plan that could possibly mean $700,000 upon retirement. They are eligible to participate after one year and become fully vested after six years. No one has quit after becoming vested in this company. To further help his employees, the owner brings in a financial advisor to help the employees pick stocks, plan for retirement, or to get advice on buying a house or saving for a child’s college education.
Other friendly-factor benefits:
- Every year, employees celebrate their work anniversary with a cake. They also receive $100 for each year employed, made out in a check so they can buy work tools for the shop.
- Twice a year, the employees’ children receive a $50 savings bond when the child brings in their “all As” report card.
- They reward employee safety records with what they call the “Safety Bonus Program.”
- Each employee’s driving record is screened twice a year. Anyone who has a citation during the year is removed from the program. At the end of the year, the ones who remain get to split $2,000.
- To minimize the “we-they” syndrome, every Friday employees rotate jobs. The person in the Parts Department gets to be a service technician and vice versa. This builds a stronger team and improves communication within the company.
Here are a few other friendly-factor ideas to consider:
- Reward work attendance. Set in place a “Potential Earned Bonus Account” for each employee for a set amount, say $250 every six months. Every day an employee is late, but called in to tell you – they lose $10. For every day they are late and do not call in – they lose $15. Every day they are absent, but call in – they lose $25. Every day they are absent and do not call in – they lose $35. At the end of six months they get the balance of the $250.
- During your new employee orientation, make sure you send a welcome gift or letter to the family of the new employee welcoming them to the company. Assign the new employee a mentor to help them adjust to the new environment and make them feel part of the team. After their first 30 days on the job, have a new employee celebration and invite his or her family to attend.
- Be involved in the important aspects of your employees’ lives. You should respond when there is a birth, illness, death, graduation, or wedding. These are the important events where you have a golden opportunity to build a bond between the individual and the company.
- One company photographed each employee who had worked at the company over five years. Then they put the photos on a wall for all to see. This small act built a bond and showed the employees the pride their employer had in them.
- Have a “Bring children to work day.” A couple times a year, allow your employees to bring their kids and show them what they do.
- Creating a friendly-factor work environment takes time, and it takes managers who truly care about individuals.
About the Author
Greg Smith is a nationally recognized speaker, author, and business performance consultant. He has written numerous books and has been featured on television programs such as Bloomberg News, PBS television, and in publications including Business Week, Kiplingers, President and CEO, and the Christian Science Monitor. He is the President and “Captain of the Ship” of a management-consulting firm, Chart Your Course International, located in Atlanta, Georgia. Phone him at 770-860-9464. More articles available: http://www.chartcourse.com
Sea Pro Boats to relaunch, open plant in Whitmire
Sea Pro Boats to relaunch, open plant in Whitmire
Staff Report
colanews@scbiznews.com
Published July 29, 2015
Sea Pro Boats, which was originally founded in the Midlands and later acquired by another company, announced plans today to invest $5.5 million and open a new plant in Newberry County. The project is expected to create 238 jobs.
The company said it’s returning to the market with “The Next Wave” – a new line of bay boats and center console offshore fishing boats. The new line will feature seven models, which are expected to be introduced by the end of this summer.
Founded in 1987, Sea Pro Boats was purchased by Brunswick Corporation in 2005. In June 2008 as the Great Recession took hold, Brunswick sank the Sea Pro line and closed its Newberry County plant, putting some 175 South Carolinians out of work.
Recently, Jimmy Hancock, one of the original owners of Sea Pro, along with Tidewater Boats’ founder Preston Wrenn, decided to relaunch the company.
Sea Pro’s new headquarters and manufacturing operations will be housed in a 200,000-square-foot building on S.C. Highway 121 in Whitmire that once served as a textile plant. The facility was shuttered in January 2009 by Renfro Corp., idling 600 workers.
Expected to be fully operational in the third quarter of 2015, hiring is anticipated to begin in fall 2015.
“We are absolutely thrilled to be resurrecting Sea Pro Boats in Newberry County, and the outpouring of support from the town of Whitmire has been both humbling and heartwarming,” said Hancock and Wrenn.
The owners also praised the work Newberry County and the South Carolina Department of Commerce did “to help make this dream a reality.”
The Coordinating Council for Economic Development approved a $100,000 Set Aside grant to Newberry County to assist with costs of acquisition and real property improvements. The council also approved job development credits related to the project.
“Newberry County has a strong history in boat manufacturing, so we all take special pride in this announcement,” said Henry Livingston, chairman of the Newberry County Council. “Combine that with home-grown entrepreneurs locating in a historic rural community like Whitmire, and it becomes even more special.”
Those interested in a job at Sea Pro should contact SC Works.
Employer Access to Employee Social Media
Employer access to employee social media: applicant screening, “friend” requests and workplace investigations
USA July 17 2015
A recent survey of hiring managers and human resource professionals reports that more than 43 percent of employers use social networking sites to research job candidates. This interest in social networking does not end when the candidate is hired: To the contrary, companies are seeking to leverage the personal social media networks of their existing employees, including for their own marketing purposes, as well as to inspect personal social media in workplace investigations. As employer social media practices continue to evolve, individuals and privacy advocacy groups have grown increasingly concerned about employers intruding upon applicants’ or employees’ privacy by viewing restricted-access social media accounts.
Although federal legislation has been proposed several times (see here and here), efforts to enact a national social media privacy law have not been successful. In the absence of such legislation, states are actively seeking to address employee social media privacy issues. In 2014, six states passed social media laws, and, since the beginning of 2015, four more states have passed or expanded their social media laws. Similar legislation is pending in at least eight more states. In total, 22 states have now passed special laws restricting employer access to personal social media accounts of applicants and employees (“state social media laws”).
These state social media laws restrict an employer’s ability to access personal social media accounts of applicants or employees, to ask an employee to “friend” a supervisor or other employer representative and to inspect employees’ personal social media. The state social media laws also have broader implications for common practices such as applicant screening and workplace investigations, as discussed below.
Key Restrictions Under State Social Media Laws
As a general matter, these state social media laws bar employers from requiring or even “requesting” that an applicant or employee (21 of the 22 state laws protect both current employees and applicants; New Mexico’s law protects only applicants) disclose the user name or password to his or her personal social media account. Some of these state laws also impose other express restrictions, such as prohibiting an employer from requiring or requesting that an applicant or employee:
- add an employee, supervisor or administrator to the friends or contacts list of his or her personal social media account;
- change privacy settings of his or her personal social media account;
- disclose information that allows access to or observation of his or her personal social media account, or otherwise grant access in any manner to his or her personal social media account;
- access personal social media in the employer’s presence, or otherwise allow observation of the personal social media account; or
- divulge personal social media.
These laws also prohibit an employer from retaliating against, disciplining or discharging an employee, or refusing to hire an applicant, for failing to comply with a prohibited requirement or request.
For example, a few states, like New Mexico, only cover traditional social networking accounts, while most other state laws broadly apply to any electronic medium or service that allows users to create, share or view user-generated content, including videos, photographs, blogs, podcasts, messages, emails and website profiles generally. Some of these laws only prohibit employers from seeking passwords or other login credentials to the personal social media account, while other states impose broader restrictions described above. For example, Arkansas, Colorado, Oregon and Washington prohibit an employer from requesting that an employee allow the employer access to his or her personal social media accounts; and California, Connecticut, Oklahoma, Michigan, Rhode Island, Tennessee and Washington prohibit an employer from requesting an employee to access his or her personal account in the presence of the employer. Certain states prohibit an employer from requiring an employee to change his or her privacy settings to allow the employer access to his or her private social media accounts, although it is possible that such a restriction might be inferred from at least some of the other state laws as well. Even more confusing are the inconsistencies across state laws with respect to exceptions for workplace investigations, as discussed below.
While state laws differ significantly, however, the general message is clear: Employers must evaluate their current practices and policies to ensure compliance with these laws.
What Every Employer Should Know About State Social Media Laws
A. Applicant Screening
In general, these state social media laws do not limit an employer’s ability to review public information, such as information that may be available to the general public on an applicant’s social media pages. Instead, these laws limit an employer’s attempts to gain access to the individual’s social media accounts by means such as requesting login credentials, privacy setting changes or permission to view the accounts.
Additionally, most of these laws explicitly state that they do not prohibit viewing information about an applicant that is available to the public; for example, the Michigan law “does not prohibit or restrict an employer from viewing, accessing, or utilizing information about an employee or applicant that can be obtained without any required access information or that is available in the public domain.”All of these state social media laws, however, prohibit employers from seeking access to the nonpublic social media pages of applicants. In practice, this means that employers should avoid asking applicants about the existence of personal social media accounts and requesting, or even suggesting, that an applicant friend the employer or a third party, including a company that provides applicant background investigations.
B. Friend Requests
Certain laws expressly restrict an employer’s ability to encourage an employee to friend or add anyone to the list of contacts for his or her personal social media account. This may include, but is not limited to, the employer, its agents, supervisors or other employees.
For example, Colorado’s social media legislation states that an employer shall not “compel an employee or applicant to add anyone, including the employer or his or her agent, to the employee’s or applicant’s list of contacts associated with a social media account,” and many other laws contain this type of prohibition against requesting access via what may be intended as a harmless friend request.
Although these laws do not prohibit a subordinate from friending a manager or supervisor, employers should exercise care not to require, or even request or encourage, employees to friend supervisors or other company representatives. Employers in states without social media laws or states with laws that allow “friending” should nevertheless proceed with caution when requesting access to an employee’s or applicant’s personal social media pages and think twice about “friending” or “following” employees. If an employer learns about an employee’s legally protected characteristic (such as religion, pregnancy, medical condition or family medical history) or legally protected activity (such as political or labor union activity), the employer may face greater exposure to discrimination claims if it later takes adverse action against the employee.
These restrictions may be particularly significant for employers seeking to leverage employees’ personal social media connections for work-related marketing or business development purposes. Employers should be aware that, even in states without an express restriction on friend requests, a law that generally prohibits an employer from attempting to access an employee’s or applicant’s social media account may effectively limit an employer’s ability to require or encourage employees to friend people.
C. Account Creation and Advertising
Recently, Oregon amended its existing social media law to prohibit categories of employer conduct not previously addressed in any of the existing social media laws. Under the new amendment (which takes effect on January 1, 2016), employers are prohibited from requiring or requesting that an applicant or employee establish or maintain a personal social media account or that an applicant or employee authorize the employer to advertise on his or her personal social media account. Notably, the Virginia law, which went into effect July 1, 2015, implies that an employer may be permitted to engage in the type of conduct the Oregon law seeks to prevent. The Virginia law explicitly excludes from covered information an account set up by the employee at the request of the employer.
D. Investigations
One of the most challenging areas under state social media laws involves an employer’s ability to inspect or gain access to employees’ personal social media in connection with workplace investigations. An employer may wish to access an employee’s social media account, for example, if an employee complains of harassment or threats made by another employee on social media or if the employer receives a report that an employee is posting proprietary or confidential information or otherwise violating company policy. Some of the state social media laws provide at least limited exceptions for workplace investigations, while others do not.
No express exception for investigations: The Illinois and Nevada social media laws do not provide any express exception for workplace investigations that might require access to an employee’s personal social media accounts. This suggests that an employer’s investigation of potential misconduct or legal violations may not justify requesting or requiring an employee to disclose his or her social media login credentials. (We note that, perhaps in an effort to broaden employer investigation efforts and clarify an existing ambiguity, Illinois amended its law so that, where the access sought by the employer relates to a professional account, an employer is not restricted from complying with a duty to screen employees or applicants, or to monitor or retain employee communications as required by law.)
Limited exception for investigations of legal violations: California’s social media law provides that it does not limit an employer’s ability to request that an employee divulge personal social media in connection with an investigation of employee violations of applicable laws. However, this exception does not appear to extend to other prohibited activities, such as asking an employee to disclose his or her user name and password for a personal social media account. Other states provide exceptions only for investigations of specific types of legal violations. For example, the Colorado and Maryland social media laws only provide an exception for investigating violations of securities laws or potential misappropriation of proprietary information.
Limited exception for misconduct investigations: Some social media laws extend the exception beyond investigations of legal violations to investigations of alleged misconduct. These states include California, Oregon and Washington. In general, these laws allow an employer to ask an employee to divulge content from a personal social media account, but still do not allow the employer to request the employee’s login credentials. In contrast, some states, including Arkansas, Colorado, Maryland and Michigan permit an employer to request any employee’s social media login credentials to investigate workplace misconduct.
Given these differences, employers should be mindful of the broad range of investigative exceptions in state social media laws. Before initiating an investigation that may benefit from or require access to an employee’s personal social media, an employer should first consider the restrictions imposed by the applicable state law and the scope of any investigatory exception offered by that law.
E. Best Practices
Given the inconsistencies among the different laws, it is challenging for multistate employers to manage compliance with all state social media laws. Even if it is not the employer’s practice to seek access to its employees’ or applicants’ private social media pages, there are less obvious components of the laws that will affect almost every employer, and employers should consider the following measures.
Review hiring practices for compliance with social media laws: Employers should ensure that all employees involved in the hiring process are aware of the restrictions imposed by these state social media laws. For example, recruiters and hiring managers should refrain from inquiring about an applicant’s personal social media pages or requesting access to such pages. While these state social media laws do not prohibit employers from accessing publicly available personal social media sites, employers will also want to evaluate whether this practice is advisable, given the risk of stumbling across legally protected information that cannot be used in employment decisions.
Implement social media guidelines: Employers should implement social media guidelines to mitigate potential risks posed by employee social media postings, being mindful of restrictions arising under the National Labor Relations Act and other federal and state laws. Employers also should ensure that their social media guidelines do not run afoul of these state social media laws.
Educate and train personnel: Personnel involved in internal investigations, such as human resources and internal audit personnel, need to be aware of the growing restrictions on employer access to employee personal social media accounts. Prior to seeking access to an employee’s personal social media account, or content from such an account, the internal investigators should check any applicable restrictions. In general, given the general trends in these laws, employers should avoid requesting login credentials to employees’ personal social media accounts, even in the investigation context, unless they have first consulted legal counsel
Twenty-Somethings Want Tangible Benefits From Employers – Not A “Fun Culture”
Twenty-Somethings Want Tangible Benefits From Employers – Not A “Fun Culture”
July 13, 2015 by
Millennials will comprise seventy-five percent of the global workforce by 2025 and they know they are the most desired hire in the job market today. Companies need to pay attention to what this demographic wants, if they hope to compete for their attention and retention.Pinpoint Market Research and Anderson Jones PR interviewed 1,650 twenty-somethings aged 18-29 to uncover what they really want from employers.
INTERNSHIPS: They don’t value unpaid internships because they don’t believe it will lead to employment.
- 68 percent of Millennials aged 21-25 have taken an unpaid internship
- Only 5 percent were hired after completing an internship, despite good reviews
- As a result, 42 percent say they do not seek out unpaid internships
TENURE: They “puddle-jump” jobs to increase their income opportunities.
- 39 percent, aged 20-29, have already held four-to-seven full-time jobs
- 83 percent plan to stay at a single job for just two years, unless promoted
“The best way to move up is to move on,” – Daymon, 27.
WORK/LIFE BALANCE: They will take cuts in pay in order to maintain a work/life balance.
- 88 percent, aged 20-29, say they seek a consistent work/life balance
- 57 percent say they will leave a job if they aren’t getting it
- 72 percent choose companies with work-from-home options
- 47 percent choose fewer hours over more pay
- 60 percent choose “love of job” over money earned
“If they want us to stay, they can’t work us to death…I don’t care if I make less, I want to literally love what I do every day,” – Micha, 27
TANGIBLE BENEFITS: They care more about company stability than game rooms and “fun cultures.”
- 88 percent say company stability is a top priority when considering employers
- 83 percent want tuition reimbursement for education sought while employed
- 83 percent want a clear path to promotion and they will leave if they don’t get it
- 81 percent want companies to invest in their professional development
- 78 percent want learning opportunities in leadership
- 34 percent want management training
- 73 percent want to attend conferences, networking events and seminars
THEIR VALUE: They know they have desired skills and they expect to be compensated for them.
- 47 percent of Millennials are bilingual and 23 percent are multi-lingual
- 61 percent view their social media usage as a desired skill for hiring companies
- 93 percent believe their language skills should earn them more than other candidates
“I think being fluent definitely puts me in a better position to get the job I really want because, I can, like, work with more customers and buyers than someone who only speaks English,” – Kelsey, 28
EMPLOYMENT STATUS: They plan to have multiple income streams beyond full-time employment.
- 64 percent aged 21-25 plan to own a business or freelance, in addition to full-time employment
- 19 percent say they already operate their own business or are otherwise self-employed
- 60 percent plan to utilize additional income streams such as monetizing their online behaviors, re-selling items online or operating side businesses
Their most desired self-owned business categories are mobile, app and web development (26%); restaurant, bakeries and catering companies (23%); photography studio (17%); franchise operation (7%); real estate (7%); freelance writing (6%); and video production (3%).
“This demographic is intensely aware of their value to employers based on their age, experience and skill-sets,” said Jennifer Jones-Mitchell, chief insights officer for Pinpoint Market Research and head of global marketing for Anderson Jones PR. “They know what they want from their jobs and they aren’t afraid to hold out until they get it. HR leaders need to consider structuring office environments around work-life balance and professional development if they want to attract the top-tier talent.”
The full Millennial Mindset Study covers Millennials’ brand preferences, technology preferences, what they want from employers and colleges and their overall views on corporate citizenship. To view the full report, visit Pinpoint Market Research.
Pinpoint Market Research and Anderson Jones PR anonymously surveyed 1,650 U.S. consumers. Age: 20-29. Gender: 54% female; 46% male. Annual income: 5% <$10,000; 19% $10,000-$29,999; 16% $25,000-$49,999; 26% %40,000-$74,999; 32% $75,000-$99,999; 8% $100,000-$124,999; 1% $125,000-$149,999; 1% $150,000-$174,000. Education Level: 8.33% High School or GED; 8.33% some college, but no degree; 29.17% 2-year college degree; 40.28% 4-year college degree; 13.89% Graduate-level degree. Region: 5.21% New England; 9.38% Middle Atlantic; 12.50% East North Central; 9.38% West North Central; 10.42% South Atlantic; 5.21% East South Central; 7.29 West South Central; 9.38% Mountain; 31.25% Pacific.
About Pinpoint Market Research:
Atlanta-based Pinpoint Market Research is more than just a research company. We are strategists who translate intelligent insights into actionable marketing plans. We specialize in Digital and Customer Personas; Competitive Matrix Reporting; Brand Identity IQ; Customer Journey Mapping; Messaging Audits and Strategies; Surveys, Polling and Focus Groups.
About Anderson Jones PR:
Anderson Jones PR is a full-service public relations, marketing and social media engagement agency that focuses on delivering big agency thinking at boutique agency pricing. We specialize in brand development, traditional media relations and media training, social media engagement, content marketing and crisis communications.
Job Openings and Labor Turnover May 2015
Job Openings and Labor Turnover May 2015
United States Department of Labor
Bureau of Labor Statistics
For release 10:00 a.m. (EDT) Tuesday, July 7, 2015 USDL-15-1321
Technical information: (202) 691-5870 • JoltsInfo@bls.gov • www.bls.gov/jlt
Media contact: (202) 691-5902 • PressOffice@bls.gov
JOB OPENINGS AND LABOR TURNOVER – MAY 2015 The number of job openings was little changed at 5.4 million on the last business day of May, the highest since the series began in December 2000, the U.S. Bureau of Labor Statistics reported today. The number of hires was unchanged at 5.0 million in May and the number of separations was little changed at 4.7 million. Within separations, the quits rate was unchanged at 1.9 percent and the layoffs and discharges rate was little changed at 1.2 percent. This release includes estimates of the number and rate of job openings, hires, and separations for the nonfarm sector by industry and by four geographic regions.
Job Openings
Job openings were little changed at 5.4 million on the last business day of May, remaining at a historically high level. The job openings rate for May 2015 was 3.6 percent. The number of job openings was little changed for total private and government. Job openings increased in nondurable goods manufacturing and in state and local government. Job openings were little changed in all four regions. (See table 1.)
The number of job openings (not seasonally adjusted) increased over the 12 months ending in May for total nonfarm, total private, and government. Job openings rose over the year for many industries with the largest increases occurring in retail trade, professional and business services, and health care and social assistance. Job openings decreased over the year in mining and logging and in arts, entertainment, and recreation. The number of job openings increased over the year in the South, Midwest, and West regions. (See table 7.)
Hires
The number of hires was 5.0 million in May, unchanged from April. The hires rate was 3.5 percent. The number of hires was little changed for total private and government in May. There was little change in the number of hires in all industries and regions over the month. (See table 2.)
Over the 12 months ending in May, the number of hires (not seasonally adjusted) was little changed for total nonfarm, total private, and government. At the industry level, hires increased in federal government. Among the industries, the number of hires decreased over the year in mining and logging. The number of hires was little changed over the year in all four regions. (See table 8.)
Separations
Total separations includes quits, layoffs and discharges, and other separations. Total separations is referred to as turnover. Quits are generally voluntary separations initiated by the employee. Therefore, the quits rate can serve as a measure of workers’ willingness or ability to leave jobs. Layoffs and discharges are involuntary separations initiated by the employer. Other separations includes separations due to retirement, death, and disability, as well as transfers to other locations of the same firm.
There were 4.7 million total separations in May, about the same as in April. The separations rate was 3.3 percent. The number of total separations was little changed for total private and government, and in all industries and regions over the month. (See table 3.)
There were 2.7 million quits in May, unchanged from April. The quits rate in May was 1.9 percent. The number of quits was little changed for total private and government over the month. The number of quits was little changed in all industries and in all four regions in May. (See table 4.)
The number of quits (not seasonally adjusted) increased over the 12 months ending in May for total nonfarm and total private, and was little changed for government. Over the year, quits increased in health care and social assistance and in accommodation and food services. The number of quits was little changed in all four regions. (See table 10.)
There were 1.7 million layoffs and discharges in May, about the same as in April. The layoffs and discharges rate was 1.2 percent. The number of layoffs and discharges was little changed over the month for total private and government, and in all four regions. (See table 5.) Seasonally adjusted estimates of layoffs and discharges are not available for individual industries.
The number of layoffs and discharges (not seasonally adjusted) was little changed over the 12 months ending in May for total nonfarm, total private, and government. The number of layoffs and discharges increased over the year in federal government, but decreased in real estate and rental and leasing. There was little change in layoffs and discharges over the year in all four regions. (See table 11.)
In May, there were 391,000 other separations for total nonfarm, about the same as in April. Over the month, the number of other separations was little changed for total private at 324,000 and for government at 67,000. (See table 6.) Seasonally adjusted estimates of other separations are not available for individual industries or regions.
Over the 12 months ending in May, the number of other separations (not seasonally adjusted) was little changed for total nonfarm, total private, and government. Other separations increased in federal government, but decreased in accommodation and food services and in state and local government. The number of other separations was little changed in all four regions. (See table 12.)
Net Change in Employment
Large numbers of hires and separations occur every month throughout the business cycle. Net employment change results from the relationship between hires and separations. When the number of hires exceeds the number of separations, employment rises, even if the hires level is steady or declining. Conversely, when the number of hires is less than the number of separations, employment declines, even if the hires level is steady or rising. Over the 12 months ending in May 2015, hires totaled 60.2 million and separations totaled 57.4 million, yielding a net employment gain of 2.8 million. These totals include workers who may have been hired and separated more than once during the year.
For tables and to read more, please click here.
Job market’s new normal: Smaller workforce, sluggish pay
Job market’s new normal: Smaller workforce, sluggish pay
WASHINGTON — Even after another month of strong hiring in June and a sinking unemployment rate, the U.S. job market just isn’t what it used to be.
Pay is sluggish. Many part-timers can’t find full-time work. And a diminished share of Americans either have a job or are looking for one.
Yet in the face of global and demographic shifts, this may be what a nearly healthy U.S. job market now looks like.
An aging population is sending an outsize proportion of Americans into retirement. Many younger adults, bruised by the Great Recession, are postponing work to remain in school to try to become more marketable. Global competition and the increasing automation of many jobs are holding down pay.
Many economists think these trends will persist for years despite steady job growth. It helps explain why the Federal Reserve is widely expected to start raising interest rates from record lows later this year even though many job measures remain far below their pre-recession peaks.
“The Fed may recognize that this is a new labor-market normal, and it will begin to normalize monetary policy,” said Patrick O’Keefe, an economist at accounting and consulting firm CohnReznick.
Thursday’s monthly jobs report from the government showed that employers added a solid 223,000 jobs in June and that the unemployment rate fell to 5.3 percent from 5.5 percent in May. Even so, the generally improving job market still bears traits that have long been regarded as weaknesses. Among them:
— A shrunken labor force.
The unemployment rate didn’t fall in June because more people were hired. The rate fell solely because the number of people who had become dispirited and stopped looking for work far exceeded the number who found jobs.
The percentage of Americans in the workforce — defined as those who either have a job or are actively seeking one — dropped to 62.6 percent, a 38-year low, from 62.9 percent. (The figure was 66 percent when the recession began in 2007.) Fewer job holders typically means weaker growth for the economy. The growth of the labor force slowed to just 0.3 percent in 2014, compared with 1.1 percent in 2007.
“It is highly unlikely that we are going to see our (workforce) participation rate move anywhere near where it was in 2007,” O’Keefe says.
This marks a striking reversal. The share of Americans in the workforce had been steadily climbing through early 2000, and a big reason was that more women began working. But that influx plateaued in the late 1990s and has drifted downward since.
— The retirement of the vast baby boom generation.
The aging population is restraining the growth of the workforce. The pace of retirements accelerated in 2008, when the oldest boomers turned 62, when workers can start claiming some Social Security benefits. Economists estimate that retirements account for about half the decline in the share of Americans in the workforce since 2000.
From that perspective, the nation as a whole is beginning to resemble retirement havens such as Florida. Just 59.3 percent of Floridians are in the workforce.
— Younger workers are starting their careers later.
Employers are demanding college degrees and even postgraduate degrees for a higher proportion of jobs. Mindful of this trend, teens and young people in their 20’s are still reading textbooks when previous generations were punching time clocks.
The recession “basically told everybody that they need an education to get better jobs,” says John Silvia, chief economist at Wells Fargo. “So how would young people respond? They stayed in school.”
Fewer than 39 percent of 18- and 19-year-olds are employed, down from 56 percent in 2000. For people ages 20 to 24, the proportion has fallen to 64 percent from 72 percent.
— The number of part-timers who would prefer full-time work remains high.
About 6.5 million workers are working part time but want full-time jobs, up from 4.6 million before the recession began. This is partly a reflection of tepid economic growth. But economists also point to long-term factors: Industries such as hotels and restaurants that hire many part-timers are driving an increasing share of job growth, researchers at the Federal Reserve Bank of San Francisco have found.
As more young adults put off working, some employers are turning to older workers to fill part-time jobs. Older workers are more likely to want full-time work, raising the level of so-called involuntary part-time employment.
Many economists also point to the Obama administration’s health care reforms for increasing part-time employment. The law requires companies with more than 100 employees to provide health insurance to those who work more than 30 hours.
Michael Feroli, an economist at JPMorgan Chase, says this could account for as much as one-third of the increase in part-time jobs.
— Weak pay growth.
The average hourly U.S. wage was flat in June at $24.95 and has risen just 2 percent over the past year. The stagnant June figure dispelled hopes that strong job growth in May heralded a trend of steadily rising incomes.
In theory, steady hiring is supposed to reduce the number of qualified workers who are still seeking jobs. And a tight supply of workers tends to force wages up.
Yet a host of factors have complicated that theory. U.S. workers are competing against lower-paid foreigners. And automation has threatened everyone from assembly line workers to executive secretaries.
Still, economists at Goldman Sachs forecast that average hourly pay will grow at an annual pace of about 3.5 percent by the end of 2016. That is a healthy pace. But it will have taken much longer to reach than in previous recoveries.