News from Hiring Source



Economic Update

The Houston area added 2,700 jobs in April, according to Texas Workforce Commission (TWC). Job gains in April reduced the 12-month net loss to 40,900 jobs from 102,800 in December 2009. Job gains occurred in several sectors – healthcare; administrative; entertainment; food services; oil & gas services; and real estate. Construction and manufacturing reported losses in April but at subdued rates compared to this time last year. April marks the third consecutive month of job gains for the region. Since February, Houston has added 28,400 jobs, about one-fifth of total jobs lost during the recession. Analysts say layoffs will keep tapering off and companies will gradually hire more. “While we will still see a period of job growth, it is going to take a long time to get back the jobs we lost,” said Mark Zandi, economist at Moody’s Analytics who predicts the nation will not recover the 8 million jobs lost in the downturn until 2013. Fewer people are filing claims for unemployment aid nationwide, new jobs are showing up in service industries, and companies are squeezing all they can from lean staffs and may need to hire soon. Initial unemployment claims fell by 3,000 to a seasonally adjusted 456,000, the Labor Department said. This was the third straight drop. At the same time, the tally of laid-off workers continuing to claim jobless benefits fell by 255,000 to 4.5 million. This was the largest decline in almost a year.

Americans’ appetite for spending has eased. Manufacturing output has been strong, but this is mostly because businesses are replenishing their stockpiles after slashing them during the recession. Unless Americans increase spending, manufacturing could fizzle. A sharp drop in retail sales revenue for May shows shoppers remain cautious, and this could lead economists to curtail expectations for growth. The 1.2% plunge in sales revenue was the largest drop in eight months. Any sustained pullback by shoppers could threaten the recovery because consumer spending accounts for 70% of economic activity. “This is a very soft recovery compared to what you would normally see after such a deep recession,” said Nigel Gault, chief U.S. economist for HIS Global Insight. Productivity grew in the first quarter at the slowest annual pace in a year – 2.8%, the Labor Department said.

Consumer habits are closely tied to employment and wage growth. In Fourth Quarter 2009, Harris County recorded the highest average weekly wage among Texas’ counties with more than 75,000 jobs, according to TWC. The weekly wage in Harris County averaged $1,197 in Fourth Quarter 2009, a 15% increase from the prior quarter and 27% above the state’s average of $944. Americans saw their wealth increase at the start of this year as the economic recovery boosted stock portfolios. The Federal Reserve reported household net worth rose by 2.1% in the first three months of this year to $54.6 trillion. Stock portfolios were the biggest force lifting net worth in the first quarter. Even with the first-quarter gain, Americans’ net worth would have to rise an additional 21% to get back to its pre-recession peak of $65.9 trillion. Analysts do not think household wealth will return to its pre-recession levels until around 2012.

In First Quarter 2010, the cost of living in Houston was 18% below the average for 27 metropolitan areas over 2 million population and 9% below the average for all 308 reporting places. Bargain housing costs help maintain Houston’s low cost of living. In First Quarter 2010, housing costs in Houston were 39% below the major metro average and 22% below the average of all 308 reporting places. The cost of grocery items in Houston was also the lowest among the major metro areas, 17% below the major metro average and 13% below the national average.

Among major metros, Houston led the nation in entrepreneurial activity for 2009 per U.S. Census Bureau and Bureau of Labor Statistics. More businesses were created last year than were created during the high-tech boom of 1999 and 2000. The rate of entrepreneurial activity among Americans in 2009 hit its highest point in 14 years. The states with the highest rates of entrepreneurial activity were Texas, Oklahoma, Montana, Arizona, and Idaho.

Legal Update

COBRA Subsidy Extended

On April 15, 2010, President Obama signed the Continuing Extension Act of 2010 that continues the 65% COBRA subsidy program through May 31, 2010. While COBRA subsidy eligibility ended after March 31, 2010, the latest extension provides subsidies for involuntary terminations in all of April and May and applies retroactively to the program’s March 31 expiration.

Hiring Source is a placement firm that specializes in the following disciplines: Administrative, Accounting, Legal, Human Resources, and Sales/Marketing. The firm offers temporary, temp-to-hire, and direct hire placement throughout the Greater Houston area. The President, Jennifer Lacy Briscoe, has extensive experience in the industry and has been recognized as a Top Producer by Texas Association of Personnel Consultants. Hiring Source is a local firm that takes pride in providing personalized service to each and every one of their candidates and client companies.

Sources: Greater Houston Partnership, HR Houston, Houston Chronicle, Houston Business Journal

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June 2010

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