Posted on Dec 08, 2011
What Does the Latest Jobs Report Mean for Business Owners?
With so much focus on the economy this election cycle, the December 2011 jobs report may seem like a mere political football that marks the success or failure of a president – but it’s far more to business owners looking for a sign that it’s safe to hire again.
Last week’s jobs report revealed that the unemployment rate was reduced by nearly half a point to 8.6 percent, the lowest it has stood in two and a half years. This may increase consumer confidence, but take note: The jobless rate dropped in part because those who stopped looking for work (estimated to be around 300,000 Americans) were no longer included in the Labor Department calculations that determined the 8.6 percent figure. If those who had given up looking had returned to the labor force, experts say that the jobless rate would be in the double-digits. What does all this mean for business owners?
According to Jill Schlesinger, editor at large of CBS/MoneyWatch, “It means that they will look for consistency” when looking to add employees right now – or they should. “While we have seen a slow decline in the unemployment rate over the past 18 months, it has been so inconsistent. And when you look back over almost any three month period, you can't find three consecutive months where we've had robust growth, where we've seen great demand from consumers and from businesses.”
Schlesinger believes that business owners are considering the consistency factor when weighing their hiring options. “So as a business owner,” she said, “you ask yourself, ‘Well why am I going to take the risk of adding a new job when I don't know if next month's the bad month or the beginning of the next leg down.’ So I think we need consistent growth. That would go a long way into making employers feel more comfortable adding to their payroll.”
Once a decline in the jobless rate is matched by healthy economic growth, business owners should feel more at ease about hiring new employees. The next jobs report from the U.S. Department of Labor Bureau of Labor Statistics is scheduled for release on January 6, 2012.
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