Our survey last month asked if there was potential for hiring in respondent’s firms or companies they are familiar with over the next six to nine months. We conducted the same survey 13 months ago and the results show increasing optimism on hiring prospects.

On the national front, employment gains in March, April and May were 353,000, 346,000 and 248,000 jobs, respectively. According to the most recent Bureau of Labor Statistics (BLS) data for 2004 non-farm employment in the Metro Washington area increased 2.8%. The BLS Boston/New Hampshire Metropolitan statistical base still showed an overall 1.2% decline in non-farm employment so far this year. Statewide, Massachusetts did post a 2,700 increase in jobs in March followed by 5,500 in April, and an even larger 9,700 gain in May, the most since September 2000. Just under 20,000 jobs have been added in Massachusetts since February.

Temporary staffing agencies both in Greater Boston and Metro Washington are seeing an increase in demand as businesses still hold off on permanent hires for the time being. In keeping with typical practices during economic recovery phases, companies tend to hire part-time rather than full-time employees until assured that economic growth for their sectors will be sustained. Nevertheless, temporary hiring is usually a precursor to permanent hiring on a broader front. Overall results of last month's survey suggest that respondents are even more bullish on the potential for hiring over the next 6 to 9 months than in our previous survey, although the degree of optimism still differs for Greater Boston and Metro Washington.

Greater Boston Responses

In last month's survey, seventy-five percent of the Greater Boston respondents expect that hiring will occur in the next 6 to 9 months. That was substantially higher than the fifty percent who expected a hiring rebound in the same time span thirteen months ago. The bottom three categories showed a similar change in optimism. Only twenty-five percent of the respondents now feel that hiring is not in the cards, compared to the last survey when fifty percent were pessimistic about job increases. At that time eleven percent said that more downsizing was likely – in the latest survey only four percent believe more downsizing will occur.

Metro Washington Responses

Seventy-eight percent of the Metro Washington respondents believe that hiring will occur in the 3rd and the 4th quarter of 2004. In the last survey, a lower sixty percent believed that there would be hiring by the end of 2003. Twenty-two percent now feel that hiring is unlikely in the near term, while forty percent felt that way just over a year ago. Of this less optimistic group, thirteen months ago nine percent believed more downsizing was likely, but in the latest survey only three percent now hold this pessimistic view.

In Metro Washington there is a continued increase in optimism on the potential for job creation, with thirty-eight percent now believing there absolutely will be hiring compared to thirty-two percent in the last survey, likely based on continuing leasing activity by the federal government and related sectors of the economy. In Greater Boston in our last survey only sixteen percent believed there absolutely would be hiring, but this time that camp has doubled with thirty-one percent absolutely feeling that hiring will occur in six to nine months, a marked improvement in outlook.

Contact - Robert Kasvinsky, Vice President, Business and Strategic Intelligence