Waiting for good news? So are employers
NEW YORK (Reuters) - If you take one open job, and one ideal job candidate, how many rounds of interviews will it take for that person to get hired?
The answer is three. It often takes three rounds of job interviews before a job is filled, according to U.S. staffing giant ManpowerGroup, whose experience finding people for its clients to hire helps illustrate the stalled U.S. jobs market.
"We'll bring a candidate forward and they'll interview the candidate three times," Manpower Chief Executive Jeff Joerres said on Friday. "They're hedging their bets always, they're waiting for the perfect candidate -- and in the meantime they're saving money."
The U.S. Labor Department earlier reported that employment growth ground to a halt in August and the unemployment rate held steady at 9.1 percent.
Manpower's Joerres described a cautious environment, as companies await concrete signs that demand is returning for their goods and services. Employers are also uncertain over whether the Obama Administration will embrace pro-business policies.
They were also spooked last month by issues as varied as the government debt limit impasse, the downgrade of U.S. credit, Europe's debt crisis, and the stock market decline.
"Companies have the ability to make very fast moves, in decreasing or increasing hiring, and right now they're in pause mode," Joerres said.
Still, a pause is better than some alternatives, Joerres said, noting that without a strike at Verizon Communications, the U.S. economy would have added jobs last month.
Staffing industry executives and analysts say Friday's labor data actually supports arguments that a double-dip recession is unlikely, because temporary jobs continue to be added.
"We've been hearing a lot of chatter about a double dip recession, but for right now there's no indication in the labor market to expect one," said Tig Gilliam, who heads North American operations at Adecco SA, the world's largest temp staffing provider. "Companies are not letting temporary workers go in large numbers as they have in the past."
Friday's government report showed 4,700 temp jobs added last month, more than in the July, and the percentage of temps in the overall labor force rose slightly. Analysts have said this so-called "penetration rate," currently 1.7 percent, will likely surpass its peak in the prior economic cycle of just over 2 percent.
"Our business is still positive but nobody will commit on a permanent basis," said Roy Krause, CEO of SFN Group Inc, which will become part of Randstad Holding NV once a takeover closes.
Krause said small business owners are concerned about access to credit.
"Banks have all kind of money, the question is whether they'll lend it to you," he said, adding he put chances of a new recession at 25 percent or less.
Staffing shares were lower across the board in Friday afternoon trading. Manpower lost 3.5 percent to $37.89, Robert Half International Inc fell 3 percent to $22.64 and Kelly Services Inc fell 3.7 percent to $13.92. In Europe, Randstad fell 3.4 percent and Adecco lost 6.5 percent.
The next data point for investors in the employment services sector will be U.S. President Barack Obama's speech next Thursday, in which he's expected to announce steps to support job creation. But any new policy steps would take months to implement and so would have little effect on near-term jobs trends, industry executives said.
"I don't think we should be waiting for the President's speech to see if we'll be saved in September," said Manpower's Joerres. "It's just not that simple."
(Reporting by Nick Zieminski; Editing by Tim Dobbyn)