The August jobs report brought some welcome clarity to an employment market that has been difficult for employers to read. According to the U.S. Bureau of Labor Statistics (BLS), total nonfarm payroll employment increased by 162,000 in August, while the national unemployment rate held steady at 4.1%. That August gain was significantly stronger than the average monthly gain of 31,000 over the previous 12 months.
At first glance, that sounds like a healthy labor market, and it is. But for employers in Charlotte and throughout the surrounding region, the bigger story may be what the numbers suggest about how companies should approach hiring in the months ahead. The labor market isn’t simply “hot” or “cold.” It is becoming increasingly nuanced.
A Stronger Jobs Number Doesn’t Mean Every Employer Will Find Talent Easily
The August numbers were driven in part by continued hiring in industries such as food services, local government education and healthcare. At the same time, employment declined in the information sector, while construction employment was relatively stable. In other words, the employment picture varies considerably by industry, occupation and skill set – and that’s an important distinction for Charlotte employers.
According to Lisa Hildreth, Sherpa Managing Director, “Charlotte’s labor market is becoming more and more diverse with a a collection of very different talent markets operating within the same region. Charlotte Works’ latest workforce data recently showed nearly 792,000 jobs across more than 53,000 business establishments, with significant employment in healthcare, finance and insurance, professional services, retail, and other industries. Just as importantly, wages vary dramatically by industry. Finance and insurance, for example, averaged $2,538 in weekly wages, compared with $613 in accommodation and food services. For employers, that reinforces an important point: a national unemployment rate doesn’t tell you how difficult it will be to fill your particular position in Charlotte. The more useful questions are:
- How large is the local talent pool for the skills we need?
- What are qualified candidates earning?
- How quickly is demand for those skills changing?
- And are we competing with other employers for the same people?
That’s where local labor-market intelligence, and an experienced recruiting partner, can provide considerably more insight than a headline jobs number.”
3 Ways Charlotte Employers Should Look at the August Jobs Report
1. Don’t assume that a higher unemployment rate or a strong jobs report solves your hiring problem.
A national unemployment rate of 4.1% does not tell you whether the specific accounting, HR, operations, supply chain or marketing professional you need is available in Charlotte. Employers should be looking at labor-market data at the occupational and local level. If you’re struggling to find a Senior Accountant, Financial Analyst, HR Manager or Supply Chain professional, the relevant question isn’t simply, “What’s the unemployment rate?” It’s: How large is the qualified talent pool for this particular position, and how competitive is the market for those candidates? That distinction can have a major impact on compensation, time-to-fill and recruiting strategy.
2. Reevaluate whether every position needs to be a permanent hire.
One of the most valuable things employers can do in an uncertain market is give themselves more flexibility. A permanent employee may be exactly what you need. But sometimes the business need is different. Perhaps you’re dealing with:
- A temporary increase in workload
- A six-month project
- A leave of absence
- A backlog in accounting or finance
- A system implementation
- A merger or acquisition
- A seasonal demand spike
- A position that you aren’t ready to make permanent
That’s where different employment models can become strategic, not simply transactional. Contract, contract-to-hire, temporary and project-based staffing can give employers access to experienced talent while allowing them to respond to changing business conditions. “Heading into September and budget season,” notes Alissa Farrow, Sherpa’s Manager of Delivery Excellence, “is a good time to look at contract talent as more than a short-term staffing solution. It can give companies the flexibility to address immediate workload needs while allowing them to be more deliberate about where they commit permanent headcount in the coming year.”
The right employment structure depends on what your business needs.
3. Look at your workforce as a portfolio – not a collection of open positions.
The best workforce strategies don’t begin with a job description. They begin with a business question: What does our organization need to accomplish over the next 6, 12 or 18 months? That answer may lead to a combination of approaches. You may need a direct-hire employee to build long-term organizational capability, a contract professional to handle an immediate workload, and a project consultant to lead a specialized initiative. You may also discover that an existing employee could take on more responsibility if you supplement the team with specialized expertise. That is where a broader talent strategy can make a difference.
Where Sherpa Can Help
At Sherpa, we believe employers shouldn’t have to choose between “hire someone permanently” and “do nothing.” Our specialized recruiting and staffing practices allow us to help employers evaluate the situation and determine which approach makes the most sense. The August jobs report is a reminder that the labor market is not one-size-fits-all. For Charlotte employers, the smartest response isn’t necessarily to hire more or hire less. It is to hire strategically. Understand the data. Look at your specific talent market. Evaluate the business need behind each position. And consider whether permanent, temporary, contract or project-based talent is the right solution. Because in a changing labor market, flexibility isn’t just a recruiting advantage – and it’s one our team can help you take advantage of.
