As the labor market continues to tighten, with employers filling an additional 211,000 positions in November and more job openings expected in 2016, it’s getting harder for firms to find qualified workers.
Look for payrolls to expand further next year by 190,000 jobs per month on average, versus 2015’s 209,000 per month. The slight downshift will come as the jobless rate keeps on falling--to 4.6% as 2016 ends. That’s close to what economists consider to be full employment, though the rate is actually near 10% when the discouraged and underemployed are counted.
The strong job market will pressure wages as more and more employers boost pay to lure workers. We expect wages to go up 2.5% on average next year, compared with 2.2% this year. In 2017, as the economy continues to gain steam, they’ll rise 2.8%.
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Among the fastest-growing jobs: In tech, developers of applications and systems software, database administrators, cybersecurity experts and all manner of artificial intelligence specialists.
In health care: physician assistants and nurse-practitioners, in addition to doctors, pharmacists and dentists. Also, respiratory therapists, cardio and radiological technicians and similar jobs, which pay around $50,000 or more a year with just a two-year associate degree.
Other fast-growing fields include transportation, where air traffic controllers and truckers remain in acute demand. Financial services, where financial planners are needed to serve retirees, will also see job growth, along with primary education, which lacks enough teachers.
But some jobs will stay in a sustained decline. Printing press operators, for example, whose ranks are being depleted by the digital age. In fact, the outlook for factory workers is gloomy across the board. Those jobs are being replaced by increased automation or are being shifted abroad.
What firms can do
Helpful ways to find and keep good workers: Recruit in adjacent industries for people with skills that can be adapted to your needs with adequate training. Establish internships and apprentice programs to tap younger candidates. Welcome back former employees, who may be more than happy to return. Many companies are reversing policies against taking back folks who flew the coop.
Don’t overlook veterans. And be open to hiring former felons, giving them a second chance. You can earn a tax credit of up to $9,600 per veteran or ex-con hired. Cultivate a reputation as a great place to work, which is important to millennials and others. Thank job applicants for their interest -- they’ll think well of you for it.
Consider expanding your referral bonus program to spouses, ex-workers, etc. Workers who come in via referral are typically of higher quality and more familiar with your business. Provide solid career advancement opportunities through mentoring and continuing education. They’ll entice star workers to stick with your company.
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