Win quarterly summary q3 2015 optimized

Q3 2015

WORKFORCE INTELLIGENCE NETWORK QUARTERLY DATA SUMMARY

CONTENTS Overview County-By-County Analysis Occupational Cluster Analysis Highest Posting Occupations Labor Market Participation and Employment

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JOB DEMAND SUMMARY: 3rd QUARTER 2015 EMPLOYMENT DEMAND FINDINGS The Workforce Intelligence Network for Southeast Michigan (WIN) released 3rd quarter (Q3 includes July, August, and September) 2015 labor market trends, including real-time employer demand determined through online job postings, for the 9 counties of Southeast Michigan (Genesee, Livingston, Macomb, Monroe, Oakland, Shiawassee, St. Clair, Washtenaw, and Wayne) and the City of Detroit.

Below is a summary of the county-by-county reports, which can be found in their entirety by using the link below: www.win-semich.org/data-research/quarterly-reports/

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SECTION ONE OVERVIEW

OVERVIEW

Q3 2015

Q3 is often a time of continued labor market expansion in Southeast Michigan with more individuals in jobs and more looking for work. Thus far, 2015 is on track to be the highest recorded employment since mid-2008. While progress has been slow, the number of individuals working in Southeast Michigan is on the rise. Q3 and Q4 often show the strongest employment growth each year, and Q3 2015 is on track to continue this trend, with 15,276 additional workers gaining jobs compared to Q2 2015. Q3 2015 also is showing promise over the previous year, with 38,205 more individuals employed than in Q3 2014.

For much of the past several years, the labor force has been slow to grow, if at all, and even declined in several quarters. Q3 2015 saw an increase of 28,179 additional workers who entered the regional labor force. While Q3 2015 showed some positive movement, the current labor force is smaller than it was at the same time last year, in Q3 2014. This creates a challenging environment for employers, who will continue to struggle to find qualified workers. In some cases, shortages will put positive pressure on wages, but in other cases, employers may have to forego opportunities because they cannot find the talent they need, or they may need to look to 4 technology or other means to boost productivity of their current workers.

The unemployment rate increased by a half of a percentage point during Q3 2015, moving from 5.8 percent in Q2 2015 to 6.3 percent in Q3 2015. This increase was because the labor force grew more quickly than employment.

While an increasing unemployment rate is not always welcome, in this case, it signified that more workers were entering or re-entering the labor force, increasing the talent base from which employers could choose for open positions.

“The third quarter is often a welcome expansion each year with more individuals working,” said Lisa Katz, executive director for WIN. “While the unemployment rate increased, it is due to general labor market expansion, a positive sign for employers who need to fill open jobs.”

With 137,515 online job ads, Q3 2015 postings once again reached an all-time high. Postings have continued to grow in a linear pattern since the most recent valley in Q3 2014, when the number was only 85,878. Q3 often marks a peak in job postings compared to previous quarters in the year.

“As WIN predicted, the third quarter represented a peak in postings for the year, but it also demonstrated levels of job-demand not seen since 2008. The labor-market expansion, while not nearly enough to meet employer demand, was a welcome change and underscored a bit of worker-optimism, coinciding with another quarter of growth,” added Katz. “If the fourth quarter follows the same trend, the region will be well positioned going into 2016.”

What other factors affect employment? Interest rate changes/signals, indices, and other metrics can help round out the employment story.

• Interest rates represent the cost of borrowing money. When interest rates are high, the cost of borrowing is high, so people and companies tend to spend less on goods and services, which can dampen job growth. Conversely, when interest rates are low, the cost of borrowing is lower, encouraging spending and, presumably, encouraging job growth.

When people have more to spend, such as when interest rates are low, the result can be upward pressure on prices (inflation). This, in turn, can reduce the amount people can buy, putting downward pressure on economic growth, including jobs.

To help spark the national economy following the Great Recession, for an extended period of time, the Federal Reserve has kept interest rates at historic lows (near zero). With the unemployment rate declining, Fed leaders have been trying to determine whether to raise interest rates in the hopes of keeping the economy balanced and avoiding rising inflation, which can be difficult to control. Moving interest rates too soon or too much, however, could also have the negative effect of inhibiting job growth.

Because unemployment has been declining in great part due to decreases in the labor market, and somewhat due to employment increases, market signals that traditionally would trigger an increase in interest rates have been difficult to read. As long as inflation remains at bay, the Fed may avoid increasing interest rates in the next quarter, but if inflation, coupled with employment growth, begins to emerge, interest rates may indeed go up. Further, higher interest rates in the U.S. make the domestic market a more attractive place to invest, which could draw it away from other global markets that are struggling to stabilize and/or develop. These and other factors that could affect Fed decision-making around interest rates. http://www.nytimes.com/2015/11/07/business/economy/jobs-report-hiring-unemployment-october.html?_r=0 • Consumer confidence measures the degree of optimism that consumers feel towards the economy and their own financial situation. When confidence is down, consumers may back off on spending, which puts downward pressure on the economy and jobs, and vice versa. As surveyed by University of Michigan, the Consumer Confidence Index has exhibited a positive pattern throughout 2015. The first two months of Q3 2015 showed a slight drop in sentiment, but levels remained above 2014 averages. October saw an overall rebound, with gains in confidence among lower-income households. As consumer confidence increases and remains high, aggregate demand in the economy is likely to follow. http://www.sca.isr.umich.edu/ 5

SECTION TWO COUNTY-BY-COUNTY ANALYSIS

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TOTAL POSTINGS Q3 2015 From Q2 2015 to Q3 2015, regional postings increased 12.5 percent, growing from 122,261 to 137,515 and reaching a high not seen since 2008. All occupational clusters that WIN analyzes in depth (see below) gained postings during Q3 2015.

Geographically, growth in online job postings was led by Oakland and Wayne counties (40.5 percent and 38.5 percent of the total regional posting growth, respectively). St. Clair and Monroe counties contributed the least growth (0.5 percent and 0.7 percent, respectively). All nine counties in the region saw an increase in postings from Q2 2015 to Q3 2015. Postings increased by more than ten percent in all but two counties during Q3.

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SECTION THREE

OCCUPATIONAL CLUSTER ANALYS

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HIGHEST POSTING OCCUPATIONS WIN tracks four key occupational clusters regularly, including advanced manufacturing (broken down by engineering/design occupations and skilled trades/technician occupations), health care, information technology, and retail and hospitality. Together, these clusters accounted for 58.2 percent of all Q3 2015 online job ads in the region, and each cluster individually experienced posting gains of at least 6 percent compared to Q2 2015.

Posting growth in the region was led by two occupational clusters: Retail & Hospitality (37 percent of regional growth) and IT (17 percent of regional growth).

During Q3 2015, 70 percent of total posting growth in the region occurred in WIN-analyzed clusters, an increase from the 52 percent of regional posting increases during Q2 2015.

The remaining 30 percent of posting activity increases occurred in occupations not included in WIN’s commonly-tracked occupational clusters. The most notable growth in job postings outside of the WIN clusters occurred in the following areas: • • •

Business management (general managers, business operations, human resources) Transportation, distribution, and logistics (truck drivers, materials movers) Financial management (auditors, finance specialists, bookkeepers)

See also the accompanying data tables for county-by-county analysis by occupational cluster.

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SECTION FOUR HIGHEST POSTING OCCUPATIONS

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THE REGION’S TOP 10 JOB POSTINGS FOR THE SECOND 3rd QUARTER 2015 WERE:

The WIN region’s top in-demand occupations have been relatively unchanged for over a year running, but the occupations that compose the list shift in rank-order depending on the point in the business cycle. Software developers, applications, and registered nurses were the top indemand positions for another quarter running. With early preparation for holiday hiring, retail salespersons moved up in demand, bumping heavy and tractor-trailer truck drivers to fourth place.

During Q3 2015, the most notable trends included: • Demand for software developers outpaced all other jobs with 6,679 postings in Q3 2015, up from 5,649 postings in Q2 2015, an 18.2 percent increase.

• Postings for registered nurses increased 12.7 percent to 5,092 in Q3 2015 from 4,519 in Q2 2015, marking yet another new high for the occupation.

• Demand for truck drivers dropped a small amount (2.6 percent) from 4,097 postings in Q2 2015 to 3,990 in Q3 2015, falling from third place to fourth in rank of most in-demand positions.

• Customer service representatives increased in employer demand by 21.9 percent, growing from 2,387 postings in Q2 2015 to 2,909 in Q3 2015.

• Business intelligence analysts also increased in demand, growing 9.4 percent from 1,546 postings in Q2 2015 to 1,691 in Q3 2015.

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SECTION FIVE

LABOR MARKET PARTICPATION AND EMPLOYMENT The Q3 2015 data demonstrated further increases in both employment and the labor force in the region. Q3 2015 employment expanded 0.7 percent, adding 15,276 jobs throughout the region. This was lower that the over 20,000 jobs added between Q1 and Q2 this year. Compared to Q3 2014, average employment for Q3 2015 was roughly 38,000 workers higher.

Labor-force roles increased during Q3 2015, welcome growth after several quarters of decline and plateaus. During Q3 2015, 28,179 individuals joined the labor force, 1.2 percent growth over Q2 2015.

The unemployment rate increased by a half of a percentage point during Q3 2015, moving from 5.8 percent in Q2 2015 to 6.3 percent. This increase was because the labor force grew more quickly than employment. While an increasing unemployment rate is not always welcome, in this case, it signaled that more workers were entering or re-entering the labor force, increasing the talent base from which employers could choose for open positions.

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NOTES: Updated job posting and labor force data: Due to a data update in Burning Glass Technologies’ Labor Insight tool, comparisons should not be made between the previously released Q4 2013 report and the Q1 2014 report. All numbers included in this report are the correct and updated data. Adjustments to the labor force information were also made to reflect and incorporate updated inputs, re-estimation, and controlling to new statewide totals. More information can be found here: www.bls.gov/lau/launews1.htm Demand refers to statistics derived from employer job postings, which indicate the potential for employment but may or may not materialize into actual jobs.

Labor market demand data for this report was compiled using Burning Glass Technologies’ Labor Insight Tool, and analyzed by the Workforce Intelligence Network. Check out our website www.win-semich.org for more data and detailed information about our sources.

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ABOUT WIN

The Workforce Intelligence Network of Southeast Michigan (WIN) is a collaborative effort between eight community colleges and seven Michigan Works! Agencies, in partnership with numerous other organizations, to create a comprehensive and cohesive workforce development system in Southeast Michigan that provides employers with the talent they need for success. WIN covers a 9-county area, including Genesee, Livingston, Macomb, Monroe, Oakland, Shiawassee, St. Clair, Washtenaw and Wayne. WIN was founded with the support of the New Economy Initiative for Southeast Michigan and publicly launched in November 2011.

WIN PARTNERS Community Colleges

Michigan Works! Agencies

Henry Ford College Macomb Community College Monroe County Community College Mott Community College Oakland Community College Schoolcraft College St. Clair County Community College Washtenaw Community College Wayne County Community College District

Detroit Employment Solutions Corp.

GST Michigan Works!

Macomb/St. Clair Michigan Works!

Oakland County Michigan Works!

Southeast Michigan Community Alliance Southeast Michigan Works! Consortium

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SKILLED TRADES & TECHNICIANS POSTINGS Q3 2015

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ENGINEERS & DESIGNERS POSTINGS Q3 2015

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INFORMATION TECHNOLOGY POSTINGS Q3 2015

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HEALTH CARE POSTINGS Q3 2015

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RETAIL & HOSPITALITY POSTINGS Q3 2015

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FOR MORE INFORMATION ABOUT RESEARCH AND DATA, VISIT OUR WEBSITE: WWW.WIN-SEMICH.ORG/DATA-RESEARCH

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