CareerCast.com/JobSerf Employment Index
The financial sector's recent uncertainty appears to be spreading to employment activity. After boasting 25% growth over the past six months, the volume of job openings across the U.S. dropped unexpectedly in May, falling by nearly 4% to its lowest level since February, according to the latest CareerCast.com/JobSerf Employment Index.
The volume of U.S. managerial jobs available fell by 3.3 points in May, to an Index score of 89.0. This is the first month of negative growth since January, when the Index dropped by 3.1 points, and ends three straight months of gains that had brought employment activity to its highest point since 2008.
While January's decline could be attributed to companies still setting hiring plans for the new year, May's negative performance comes during a traditionally strong month for employment activity, and at a time when managerial workers were supposed to be in demand again. In addition, with unemployment continuing to hover near double-digit levels, U.S. hiring activity will have to improve significantly in order to make any headway toward reducing jobless claims across the country.
To determine monthly employment activity, the CareerCast.com/JobSerf Employment Index surveys the volume of managerial positions posted online across the U.S., as well as the top regions, job levels and cities using proprietary employment data hand-counted by a team of researchers. What does May's overall score of 89.0 mean? The Index measures employment activity against a base score of 100, which represents the volume of job openings during the same period in 2007. A score higher than 100 means that there are more available jobs than in 2007, while one below 100 means that job seekers now have fewer opportunities available. Over the past 29 months, the CareerCast.com/JobSerf Index peaked in March 2008 with an index score of 109.3, or 9.3 points better than in March 2007. This month's score of 89.0, on the other hand, has sent hiring back down to 11 points worse than the base measurement in 2007.
Interestingly, despite the national drop in employment activity, some regions of the U.S. managed to perform well in May. The Southwest in particular experienced strong job growth for the month, gaining eight points to reach an Index score of 102.9. This is the first time that employment activity in any region of the U.S. has surpassed the base measurement in 2007, and represents the best job market the Southwest has seen since August 2008.
See complete scores and Index tracking information for all parts of the U.S. in our Regions Index
The Southwest's impressive performance also helped push it ahead of the Northeast, making it the best U.S. region for finding a new job. The Northeast, on the other hand, saw a decline in employment activity in May, as the region dropped 1.1 points to an Index score of 98.6. While this score was still good enough for second-best among all regions of the country, it marks the third time in the past four months that the Northeast has finished in second place, after it had led the nation in job availability for most of last year. That said, a majority of the 10 best cities for finding a new job still reside within the Northeast.
After a month in which all 30 major cities measured by the CareerCast.com/JobSerf Index posted gains in employment activity, May's downturn produced less consistent results. While there was no change in the order of cities that make up the 10 best places to find a job, almost all saw a significant increase in employment activity for the month. The volume of available jobs grew by another 10 points in Washington, D.C., solidifying its ranking as the best city for jobs for the 11th month in a row. Boston and San Francisco also saw a strong improvement in employment activity, gaining nine and eight points in May, respectively, while fifth-place Atlanta managed just a three point gain but still managed to stay just ahead of Baltimore. Most impressive has been the performance of Philadelphia's job market in recent months. Trailing Washington, D.C. in employment activity by nearly three to one as recently as January, the city of brotherly love has gained nearly 20 points since then, surpassing San Diego to finish as this month's 10th best city for jobs.
Less impressive, on the other hand, was Riverside's meager two point gain, which left the southern California city as the worst U.S. city for jobs for the 11th straight month. Second-worst on the list was Memphis, which saw no change in employment activity and fell back behind Detroit, which gained three points. Of the metro areas that make up the 10 worst cities to find a job, St. Louis, Phoenix, Cincinnati, Miami and Louisville all lost ground last month, while Los Angeles, which had been the first large U.S. city to fall into the bottom 10, continued to improve. Managing 10 point growth in employment activity over the past four months, the city of angels rose to 22nd place overall on the CareerCast.com/JobSerf Index, and is currently on pace to leave the bottom 10 entirely as early as next month.
Employment activity for managerial positions was especially poor in May, as none of the job titles measured by the Index managed to improve over the previous month. Leading all other job titles as recently as January, Director level hiring posted the largest drop, falling seven points to an Index score of 84. Manager level hiring, while remaining in first place among all job titles measured by the Index, also lost ground in May, dropping three points to an Index score of 94. In fact, VP was the sole job title to avoid a loss for the month – although it only managed to hold steady.
See complete info on job availability by title going back to January 2008 in our Job Level Index
Even with this new hiring downturn, the news is not all gloom and doom for the job market – employment activity in May was still nearly 60% higher than during the same period a year ago, and only 7% below May 2008 levels, before the "Great Recession" began in earnest. However, up until now employment activity has been on pace to return to 2007 base measurement levels this year. May's surprising downturn has thrown those hopes of a quick recovery into doubt, and indicates that the job market may be headed for another period of uncertainty, with growth coming in fits and starts. And if this new round of economic uncertainty continues to spread from the financial market to other sectors, job seekers may need to prepare themselves for more budget cuts, nervous hiring managers and intense competition for jobs before employment activity improves once again.
For complete information on employment by region, job level and the 10 best and worst cities to find a job, the CareerCast.com/JobSerf Employment Index's findings can be found in our detailed scoring pages.