Author: apatel

U.S. private employers continued to add jobs in September, with an additional 156,000 nonfarm jobs according to the Bureau of Labor Statistics and 151,000 private sector jobs according to the ADP National Employment Report. Professional and business services, which includes accounting and finance roles, was far and away the fastest growing sector of the employment market.

72 Consecutive Months of Job Creation

Although it was less than the 170,000 jobs expected by economists, September’s report marks the 72nd consecutive month – or six full years – of job creation. Job growth averaged 192,000 over the third quarter, which closely mirrored the first quarter’s pace and was up from the 146,000 average in the second quarter. Sustaining this level of growth will deliver enough jobs to keep up with the growing population.

The Conference Board Employment Trends Index also increased in September, suggesting moderate job growth through the first quarter of 2017. “Despite the recent decline in corporate profits, employers are not showing any signs of reducing payrolls,” said Gad Levanon, the Conference Board’s Chief Economist for North America.

Moreover, jobless claims fell to the second lowest level since 1970, just above the four-decade low in April. This marks 83 straight weeks that the filings have been below 300,000, which is not only the longest streak since 1970, but an indication of a healthy labor market.

The War For Talent

While job gains have slowed from 2015, they were robust enough to entice many Americans to look for work when they had previously been discouraged to do so. The labor force has increased by 3 million workers over the past year and nationwide unemployment has remained at or just below 5% – an eight-year low. More importantly, unemployment in Los Angeles is 4.6% and 2.5% among those with a Bachelor’s degree or higher.

The labor-force participation rate came in at 62.9% – mostly due to the retirement of many baby boomers – but more workers are rejoining the labor market, and the number of temporary employees has increased by more than 65% since the end of 2009 according to the Bureau of Labor Statistics.

September was no different, with temporary and contract employment expanded by an additional 23,200 jobs, taking the Temporary Penetration Rate to near all-time highs. A recent workplace survey by the Addison Group revealed that 94% of hiring managers were more willing to hire contract workers today than they were five years ago – 88% for senior-level roles – and 46% have used contract workers to fill their project and staffing needs in the past year. The survey also showed that these on-demand opportunities will continue, especially as the competition for skilled workers increases as the labor market continues to tighten.

Employment and Compensation are Driving the Economy

Companies facing increased pressure to fill positions faster as they compete for skilled accounting and finance professionals has had a positive effect on wage growth. For the general population, wage growth was previously stuck at around 2% and increased to 2.6% over the last year, outpacing inflation.

That said, the unemployment rate for accounting and finance professionals is half of the national and regional unemployment rates, and the increases in compensation have been more dramatic, with research from the Association for Finance Professionals reporting average salary increases of 4.6% in the past year. Dallas-based compensation consultant Dindy Robinson noted that top performers are seeing salary increases of up to 10%.

The good news is that the healthy job market has improved consumer spending and is driving economic growth amidst low productivity. Deutsche Bank’s Chief US Economist Joseph La Vorgna told Business Insider that “GDP growth in the ongoing cycle has been entirely supported by labor market gains.”

If the recent months are any indication, the economy is on a major upswing. As of mid-July, unemployment applications hit the lowest number since 1973. New unemployment claims have come in under 300,000 since February – the longest run in 15 years – and the end of the second quarter revealed the lowest unemployment rate since April 2008. The Consumer Department also reported good news halfway through the second quarter – consumer purchases, which account for about 70 percent of the economy, showed the biggest gain since August 2009.

Highlights from the Labor Department

• The overall unemployment rate decreased to 5.3%.

• The unemployment rate for individuals with a Bachelor’s degree or higher decreased to 2.5%.

• The share of people out of work for 27 weeks or longer decreased to 25.8%, the lowest since March 2009.

• The underemployment rate decreased to 10.5%, the lowest since July 2008.

• The number of Americans working part-time for economic (rather than personal) reasons decreased to 6.5 million, the fewest since 2008.

• California had the largest increase in employment from the prior year (+461,900 jobs), nearly twice that of the next-largest increase (Texas).

• California also had the second-largest increase in employment from the prior month (+23,000 jobs), only slightly lower than the largest increase (New York).

Projections show this decline in unemployment continuing through the end of the year, reaching 5.0% by January 2016.

Professional and business services – which includes accounting, finance, audit and tax roles – topped the list of job gains for June 2015, accounting for 64,000 of the 223,000 total private sector jobs added. Plus, according to CareerBuilder’s Midyear U.S. Job Forecast, the number of employers planning to hire both full-time, permanent staff and temporary/contract workers have improved from this time last year. This report shows that nearly half of these employers expect to increase starting salaries over the next year, with 1 in 6 showing an increase by 5 percent or more.

CareerBuilder also reported the hot areas for hiring – those industries expected to outperform the national average for full-time, permanent hiring in the third and fourth quarter. They include information technology, health care, hospitality, financial services, manufacturing and retail.

Bolstering this optimistic picture, the 2015 KPMG CEO Outlook Study reported that 52% of CEOs are more confident about company growth in the next three years than they were last year. Moreover, the report showed that 78% are expecting to hire more people over the next three years as well.

As a lifelong Angelino, I take pride in a career that has helped shape local professionals’ finance and accounting careers and impacted local organizations. I have spent the past 20+ years working closely with the companies and people in Los Angeles and Orange County. That’s why I am excited to be the new Managing Director for Century Group’s San Fernando Valley Office, servicing the markets where I was born and raised, as well as where I now reside, at a company with such strong roots in the Southern California area.

Combining my two decades in local staffing and recruiting with Century Group’s unprecedented reputation in our field provides the perfect backdrop to providing exceptional resources to Accounting, Finance, Tax and Audit professionals and organizations that need top expertise.

I look forward to meeting and partnering with many of you in the coming months. Please contact me to introduce yourself or with a position inquiry at any time. I can be reached at 818.844.1105 or [email protected].

Phil Bruno
Managing Director

A healthier job market helped spark the biggest gain in Americans’ confidence in almost a year, raising prospects for the economy at the start of fourth quarter.

For accounting and finance professionals, the current trends point to tightening professional labor markets with extremely low unemployment rates (less than 1% in some professional categories) and increasing compensation.

There were 4.8 million job openings on the last business day of August, up from 4.6 million in July and the highest level of job openings since January 2001, according to the U.S. Bureau of Labor Statistics.

The unemployment rate continued to decline, and more importantly, it was for the right reason. If both the unemployment and labor-force participation rates fall concurrently, it means the drop in unemployment was the result of job seekers dropping out of the talent pool and simply giving up.

The good news – that’s not what’s happening. In September, the unemployment rate fell by 0.2% to 5.9%. That’s the lowest since July 2008. The labor participation rate also dipped but by a smaller amount: 0.1% to 62.7%. Essentially, there’s a very positive reason for a part of the drop in the unemployment rate – more people are finding jobs!

Unemployment Rate (Seasonally Adjusted)

Hiring is picking up. Century Group is currently engaged on 498 searches and projects for accounting, finance, internal audit and tax professionals. The volume of search activity is equivalent to the pre-recessionary years of 2006 and 2007.

Perhaps more importantly for the accounting and finance professionals that we work with daily, the unemployment rate for individuals with a bachelors degree or higher dropped to 2.9% in September.

Unemployment Rate – Bachelors Degree or Higher

At the same time, Professional and Business Services led the way in job increases, posting 81,000 job gains in September.

Job Gains

Temp Penetration Rate

Likewise, the temp penetration rate climbed 0.01% to a new all-time high of 2.10%, as temporary help services added 19,700 jobs in August. That’s important, because temporary employment is seen as a leading indicator for employment, with temporary staffing trends leading employment by six months during periods of economic growth (and three months when the economy is emerging from a recession)

Demand for temporary workers grew 8.6% through September 2014 and is expected to increase 8.7% in Q4 2014 which would be the 19th consecutive quarter of increases (year-to-year).

Sources: Bureau of Labor Statistics, Staffing Industry Analysts and American Staffing Association

CFOs earned a 2.8 percent rise in base pay in 2013, but gave staff-level finance personnel an increase of more than 4 percent.

Corporate finance professionals at all job levels received pay increases in 2013, but staff-level employees earned the greatest hikes in pay, according to a new report by the Association for Financial Professionals (AFP).

Overall, financial professionals reported a 3.8 percent average gain in their base salaries in 2013, after garnering a 3.4 percent raise in 2012: staff-level finance employees earned the greatest increase — 4.1 percent — while management-level personnel received an average increase of 4 percent and executive-level employees an average raise of 3.5 percent.

The staff-level increase was up a full percentage point on 2012′s rise, the AFP survey found. “Analyst” titles earned the biggest salary increases, averaging 4.8 percent. Among management-level professionals, the “financial reporting specialist” title saw the highest salary increase — 5 percent. The 3.5 percent salary hike for executives, meanwhile, was down 0.3 percentage points from 2012, but still higher than was reported in the three years prior to 2012, the AFP said.

 

Directors of treasury/finance did the best in the “executive” category, earning base salary increases of 4.6 percent, followed closely by vice presidents of finance (4.4 percent). For chief financial officers, the average base salary increased just 2.8 percent, to $201,271 from $195,811. However, CFOs, like other executives, earned a substantial amount of pay in bonuses. Of all three job tiers, executive-level financial professionals received the largest average bonuses in 2013 — both in terms of total dollars and as a percentage of base salary, the AFP survey found.

However, the numbers showed no increase over 2012 or 2011. The average bonus for executive-level professionals in 2013 was $54,632, or 34 percent of base salary, about the same as in 2012. CFOs earned an average $76,620 in bonuses in 2013.

At the management and staff levels, bonuses were smaller — $16,357 (17 percent of base salary) for management and $5,874 (10 percent of base salary) for staff. For the most part, companies based performance bonuses on traditional measures, at least in part: 62 percent used operating income or EBITDA targets; 51 percent “completion of specific projects”; 48 percent “profit or increased profit” targets; and 34 percent “sales or increased revenue” targets.

Holding an MBA or graduate degree earned financial professionals at all levels a premium salary. This was particularly true at the management level, where managers with an MBA or graduate degree earned on average $15,000 more than their peers who did not hold advanced degrees.

The AFP compensation survey was conducted in February 2014 and had 4,300 respondents at more than 2,800 companies. About half the companies had revenue of more than $1 billion, and 22 percent had revenue of less than $100 million.

Originally posted on www.CFO.com – by Vincent Ryan | June 2, 2014 | CFO.com | US