Survey of managers shows jobs picture isn't exactly rosy

By John Waggoner and Barbara Hansen, USA TODAY
In another sign of a stagnant economy, relatively few companies have plans to hire more workers over the next three months, according to a survey of employers released Wednesday.
Just 29% of managers plan to increase hiring in the second quarter of 2008, according to an online survey for USA TODAY and CareerBuilder.com by Harris Interactive. The proportion of employers with plans for increased hiring is unchanged from the last quarterly survey.

The survey, conducted Feb. 11 to March 13, involved 2,757 hiring managers and human resource professionals. CareerBuilder.com is a job-finding site jointly owned by Tribune, McClatchy, Microsoft and USA TODAY parent Gannett.

The new survey follows two monthly reports from the U.S. Department of Labor showing declines in the number of payroll jobs in the USA. In January and February, payrolls declined by a total of 85,000 jobs, the government said.

The department is scheduled to issue its employment report for March on Friday. According to a Thomson Financial survey, the consensus among economists is that payroll employment declined again in March.

In the new CareerBuilder survey, 7% of those surveyed plan to lay off workers, a solid improvement from the first quarter, when 11% planned layoffs.

Fifty-nine percent of those surveyed said they plan no changes in the size of their workforce, about the same as the last quarterly survey. The job market is weakest in the Midwest, the survey shows. "The Midwest is being hammered by layoffs in the vehicle industry, and Michigan and Ohio are in recession," says Mark Zandi, chief economist for Moody's Economy.com.

Six percent of those surveyed in the Midwest said their companies planned to decrease payroll in the second quarter, the same as the national average. But just 25% of Midwest companies plan to expand, vs. 29% nationally.

Nationally, only 22% of smaller companies plan to increase their number of permanent, full-time employees, vs. 33% for large companies.

Overall, pay raises will be modest in the next three months: 41% of the survey respondents said raises would be in the 1% to 3% range, even though inflation averaged 4% for the 12 months ended in February.

Not all companies are holding back the cash. Jerry Travis, controller at Sierra Cheese in Compton, Calif., says Sierra rewarded its employees with cost of living raises to thank them for staying with the company in hard times. The company had been clobbered by milk prices, which rose from $12 per hundred pounds to $20 last year. "You can't make and sell cheese at that price," Travis says. Milk prices have since fallen to about $16 per 100 pounds.

But the company had put money aside for tough times and had enough to reward its employees. "These people have been with us forever, and we take care of the people who stay here," he says.