Security in Unsettling Times

Job Growth is Slowing

As reported by Paul Wiseman and Christopher Rugaber, the current administration’s erratic and radical trade policies are having a significant negative impact on hiring. 

The U.S. Labor Department had forecast job growth at 115,000 for last month. The actual number was 73,000, a 37% gap. July wasn’t the only month with disappointing results. Combined, May and June payrolls were lowered by 258,000, resulting in a slight rise in unemployment (4.2%), or an increase in the unemployed of 221,000.

Scott Anderson, chief U.S. economist at BMO Capital Markets, said, “A notable deterioration in U.S. labor market conditions appears to be underway. We have been forecasting this since the tariff and trade war erupted this spring, and more restrictive immigration restrictions were put in place. Overall, this report highlights the risk of a harder landing for the labor market.’'

Recent Graduates

Daniel Liberto, writing in Investopedia, explains that, “Now isn’t a good time to be entering the job market. Companies tend to hire more entry-level graduates when they are confident about the economy and their earnings prospects. That’s not currently the case, and President Donald Trump’s high import tariffs are at least partly to blame.”

At first, the impact of tariffs is felt most acutely by companies reliant on global trade, including auto manufacturers, electronics, machinery makers, pharmaceuticals, retailers, and agriculture and food processors. However, if the situation continues, all sectors of the economy will eventually feel the impact, and their hiring practices will also decline.

An example, as reported by the Independent, is Procter & Gamble, makers of everything from toilet paper to Gillette razors, has announced they will be passing on their anticipated $1 Billion tariff hit to consumers.

Your Employees are Worried

Whether your employers are recent graduates or veterans, one thing they have in common is apprehension about job security. Apprehensive employees may not be as productive as they could be. Their focus is split between their work and their well-being.

The good news is that there are steps you can take to reassure them.

How to Offer Job Security

In a recent Indeed.com article, the authors had several suggestions that your company can adopt to create a less stressed, more confident workforce.

• Talk about the future: You might know that your employees’ jobs are safe for the foreseeable future, but they might not. Letting them know about future plans and the company’s current state may give them more confidence in their job security.
• Hire from within: Promoting current employees who have the right skill set through internal versus external recruiting can help show your employees that you care about them and that they have a future with your company.
• Focus on growth: Emphasizing continued growth for your company helps secure the need for your employees. Relying on current clients without continuing to seek new ones may put you in a difficult position if you lose those customers in the future.
• Cut back: If you face a decrease in business or a difficult period, look for ways to cut back on expenses to allow you to keep your employees on staff.
• Consider alternative options: Finding alternatives to layoffs during difficult times can also give your employees more security. You might offer them the option of cutting their hours instead of losing their job completely, for example. When business picks up, they can return to their full-time hours. You might still lose employees in this scenario if they find a full-time job somewhere else, but it can keep them from losing their full paycheck.
• Set expectations: Having high expectations for employees and giving them regular feedback helps them perform better. This can give them greater job security by reducing the risk of them getting fired. Providing additional training opportunities can also help by expanding their skill set and making them valuable employees that you won’t want to lose.

Your Company Benefits

By making your workers feel secure, you can reduce employee turnover and lower your hiring and training costs. Employees who feel secure are more likely to stay with your company, and they might continue expanding their skills to advance through the ranks. This can make filling top positions easier and introduce new skills and knowledge into your company. While workers who under-perform aren’t guaranteed job security, recognizing one person’s achievements may inspire someone else to improve.

• Positive work environment: If everyone is constantly stressed about potentially losing their jobs, you'll likely notice a lack of positivity around the workplace. Employees who know their job is secure will likely feel better and have a more positive attitude about the company and their work in general. That can help create a more positive work environment. It can also create a more relaxed atmosphere where coworkers get along better. Being stressed can cause people to snap at each other and negatively impact working relationships
• Higher productivity: The stress of worrying about job loss can interfere with productivity. For some employees, knowing they don't have to worry about their jobs lets them focus more on their duties. This allows them to get more done.
• Positive image: High job security also looks good to outside parties. If you're known as a company with good job security that treats its employees well, your public reputation can get a boost, and people will want to work for you.

How Can ASN Help?

Even though the job market and economic trends seem to be changing every day, our professionals at ASN are on top of it. We continually track any developments that may impact our clients and develop strategies to guide them through troubled waters. If you would like to talk with us about how we can help your organization during these uncertain times, we would love to have that conversation. Just give us a call.