One trend both ours and other major executive recruitment firms have noticed during and after this recent recession is fewer employees are looking to change jobs. This is borne out by statistics from the Labor Department, which show that only 2,500,000 changed jobs in May (latest job figures available) down from 3,100,000 in 2006!
One major reason for this decline may be the significant drop in the monthly hiring rate, which was as high as 5,500,000 in 2006, but has dipped as low as 4,700,000 in May! This worries new Federal Reserve Chairman Yellen who recently said, “People are reluctant to risk leaving their jobs because they worry that it will be hard to find another.”
This jobs malaise has plagued many engineering recruitment agencies, scientific recruitment agencies and technical recruitment agencies like ours because some R&D, scientific, engineering, IT, technical and manufacturing positions remain in high demand, but short supply. For example, during our recent executive recruitment assignment for a high-level Lean Manufacturing Manager, many candidates I approached were interested in the position, but scared to make a job change!
Historically in the U.S. economy, job-hopping has been a main method for many workers (especially early on in their careers) to expand their skills sets and increase their salaries. Eventually, they settle down later in their careers and change jobs less frequently. This is a uniquely American phenomenon because job tenures in other industrial countries tend to be a lot longer. According to data from the Organization for Economic Cooperation and Development, workers in most developed countries average more than ten years at a given job! This contrasts with a lot shorter tenures for U.S. employees.
All executive recruitment agencies I have spoken with sound this same alarm. Without more frequent job-hopping, workers are less likely to find better jobs and wages to best meet their skills and lifetime aspirations. Because, according to economists Robert Topel and Michael Ward, as much as 66% of a worker’s lifetime wage growth occurs in the first decade of their careers, many young workers are most adversely affected by the lack of job changes.
What is your opinion?