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U.S., Global Employment Prospects Prosper MoneyNews
(Headlines - scroll down for full stories)
Manpower International, a global staffing firm, announced that 30% of U.S. companies plan to hire more employees in the second quarter of 2006. The firm surveyed 16,000 employers, and just 6% of those said that they plan to reduce staffing. The job situation in the U.S. is growing steadily. This is the ninth consecutive month that more than 20% of companies intend to increase hiring.
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Jeffrey Joerres, chairman and CEO of Manpower, said in a release, "The U.S. job market has been growing at a safe, incremental pace in recent years, and Manpower's survey data highlights the comfort zone that has emerged from this climate. Employers have reported similar levels of hiring for nine quarters now, which tells us that they are not willing to throw off the equilibrium with radical shifts in hiring." The industries showing the most optimism in the coming quarter: mining and construction. The rise in energy prices is prompting increased staffing in the coal industry; while gold's meteoric rise is triggering hires in that industry. "Mining is the one industry where significant hiring movement is in store for the second quarter. Demand for coal has skyrocketed in the wake of high oil and gas prices, and mining employers have responded by boosting their hiring plans in recent quarters. We haven't seen this degree of confidence in the mining sector in 25 years," said Joerres. And, though the housing market shows signs of cooling, huge price increases over the past few years continue to breed jobs in the construction industry, especially in the Western states like California. In fact, seven out of the ten industries Manpower surveys showed increased hiring plans for the second quarter. That's a good sign for the U.S. economy, indicating that the employment situation in the U.S. will continue to improve in the coming months. Meanwhile, global hiring plans were positive as well. Including the U.S., 23 out of 24 countries surveyed by Manpower expect to add to their workforces. Only the U.K. showed a decrease in hiring plans for the second quarter, though its employment outlook is still fifth strongest in the region next to Spain, Sweden, Norway, and Ireland. Elsewhere in Europe, Germany, a country near recession recently, intends to hire more workers in the next quarter. All of the countries in the North American and Asian-Pacific regions show double-digit employment outlooks, with Japan posting the strongest hiring expectations. Editor's Note:
2. Ethanol Boom $60 oil is fueling an alternative energy boom - and the current front-runner is ethanol. According to research firm Clean Edge, global revenues in 2005 from biofuels, including ethanol and biodiesel, were up more than 15% from 2004 at $15.7 billion. And it forecasts that the biofuels market will grow to $52.5 billion by 2015. Consulting firm LECG's John Urbanchuk, says ethanol production will increase from 4 billion gallons to 9.8 billion by 2015, in the next decade. USA Today reports ethanol plants are cropping up everywhere from Arizona to Minnesota to Hawaii. It cites the Renewable Fuels Association, which says that 33 ethanol plants are under construction, and another eight of the 95 plants in operation are undergoing expansions. What's behind ethanol's sudden rise to glory? Both President Bush and Detroit carmakers have promoted the fuel. President Bush lauded ethanol as an 'ecologically sound fuel additive' in last year's energy bill. GM recently ran ad spots promoting that some of its trucks and SUVs can run on ethanol. USA Today reports that current ethanol producers are at capacity. "Builders say they have more work than they can handle," says the paper. And, it reports that Granite Falls, Minn. plant construction firm Fagen says that they're turning work away. Some of the larger companies building new plants are Pacific Ethanol, Pinal Energy, and Archer Daniels Midland. Pacific Ethanol is building a $50 million plant in California. Pinal Energy is constructing a $62 million ethanol plant in Arizona. Archer Daniels Midland announced that it will build a plant in Nebraska. Hawaii has five proposals under consideration for ethanol plants. Editor's Note:
3. Feb. Retail Sales Plummet, Reversing Jan. Gain Retail sales dropped by 1.3% in February to total $362.3 billion for the month, according to a just-released Commerce Department report. The decline was much larger than economists had expected it to be, "as auto sales plunged and consumers took a breather after spending big in January," according to Reuters. Says the news service: "The drop in sales in February was even larger than the 0.8% decline forecast by Wall Street and marked the first decline in retail demand since August ..." But January was a whole other story. Numbers for the first month of the year have been revised to show a 2.9% gain, up from an already solid original report of 2.3%. Analysts say the upward revision is linked to increased spending as a result of unseasonably warm weather at the beginning of the year.
Meanwhile, as experts expected, auto sales went down 0.4% in February - taking their largest dive since April 2004. "Sales of motor vehicles and parts dropped 4.6% last month, the biggest drop since August 2005, after a 4.2% surge in January," Reuters reports. While there were some bright spots - building supply and grocery stores among them - year-over-year growth fell back to 6.7% overall and 8.9% excluding autos. Editor's Note:
4. Pension Reform on the Docket in Congress Two significantly different attempts at pension reform have passed the House and Senate this year, but investment advisers seem to favor the Senate's effort, says one industry expert. As things now stand, employers typically are loathe to provide financial advice to their 401(k) plan participants, wary about conflicts of interest and potential lawsuits stemming from bad advice. Under the House bill, investment advice could be provided by the financial institution (or its agents), no matter if there's a potential conflict of interest. Meantime, the Senate bill offers employers incentives to use independent advisers. "The Senate bill puts independent advisers on equal footing with the big financial services providers, thus giving the best potential results to the employee," says Jim Huller, principal of Maximum Wealth Advisors of Roanoke, Ind. "Workers would get the advice they need, and employers are protected from potential ticklish situations." A reconciled bill will likely pass muster sometime this spring. President Bush has already indicated he would sign the bill. Any type of pension reform is necessary. The government-backed Pension Benefit Guarantee Corporation (PBGC), which takes over pensions of bankrupt companies, is nearly bankrupt itself. The agency projects a $22.8 billion deficit for 2005. The new legislation would charge higher fees for companies to insure their pension plans.
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