Many companies, particularly in tech, are having trouble attracting candidates due to scarcity, a local expert says.
If you’re looking for work in the Seattle area, the new year may bring you glad tidings. The economic recovery is in full swing, with consistent, steady job growth across a range of industries. And state economists predict more of the same in 2016.
“It is kind of a boring story; there aren’t many surprises to report this year,” says Anneliese Vance-Sherman, a regional economist for the state’s Employment Security Department (ESD). “But when it comes to seeing economic recovery, I’m encouraged by that.”
As in 2015, construction-related jobs will grow the most: 4.6 percent in King County and 5 percent in Snohomish County. That’s not as much as in recent years, but that’s to be expected.
“We tend to see very high growth in construction in the aftermath of recessions to deal with pent-up demand,” says Vance-Sherman. “We are now five years out of the depths of the recession, and construction may be approaching the peak of its cycle.”
Professional and business services will also see above-average gains in both counties. This diverse sector includes everything from accounting services to janitorial services, explains Vance-Sherman. What these businesses share is their reliance on other businesses for their contracts. So when hiring is up in this sector, it means businesses are feeling optimistic.
These two sectors — construction and professional and business services — are a barometer for the rest of the job market, says Vance-Sherman. And indeed, no industry took a huge hit in 2015, which owes to where we are in the recovery. “Early on, there were a couple of industries that were carrying the recovery, but at this point, we’re seeing year-over-year growth almost everywhere,” she says.
Tech workers in driver’s seat
Many companies, particularly in tech, are having trouble attracting candidates due to scarcity, says Josh Warborg, district president of Robert Half staffing company in Seattle. Even big-name companies that could recruit on name alone in years past are having difficulty filling positions. And Amazon has something to do with that, Warborg says.
“The sheer number of people that Amazon is recruiting is having the effect of lowering unemployment and increasing wages,” Warborg explains. “The people getting squeezed are small-to-medium sized companies.”
Retail employment rose 5.6 percent in the Seattle area in 2015, and that wasn’t just grocery stores or small boutiques. Hiring at online retailers — such as Amazon — can also fall under this column, even if the positions being added are in marketing or IT.
“IT hiring is going to hide in many different places, including retail, and professional services, where you’ve got a lot of consulting firms,” says Vance-Sherman.
County at ‘full employment’
Vance-Sherman predicts that King County will see stronger overall employment gains in 2016 than Snohomish: 2.3 percent versus 1.6 percent, according to average annual growth rates calculated by the ESD. Snohomish lags behind because of flat growth in manufacturing employment, since the county is dependent on aerospace manufacturing jobs, she says.
In November, unemployment in King County was 4.6 percent, according to the ESD. That’s right at the mid-4-percent point that economists generally consider “full employment.”
Statewide, ESD reported a preliminary seasonally adjusted November unemployment rate of 5.3 percent, slightly above the national rate of 5 percent, but a marked decrease from its 6.2 percent level a year ago.
Looking ahead, state employment should rise a “reasonable” 1.8 percent in 2016, says Steve Lerch, executive director of the Washington’s Economic and Revenue Forecast Council. And while it’s definitely a slowdown from the 2.8 percent growth seen in the last year, it’s nothing to be too concerned about.
“This is something you typically see coming out of a recession: Employment grows faster, there are lots of people who lost jobs, and there’s a bigger labor pool,” Lerch says. “To see slower growth as we move away from the recession is not surprising.”