Employment agencies feeling the effects of the changing economy

Employment Agencies in the Northeast have been going through a dry spell lately as the economy tries to rebound.

In fact, the latest unemployment rate for the tri-state area is standing strong at 8.7 percent according to the Department of Labor‘s report in December 2009. The (not seasonally adjusted) data covers Philadelphia, Camden and Wilmington.

These factors have made it difficult for job seekers to find any work these days, let alone jobs at their own experience levels.

Steve Schoeffler, the vice president of marketing at On Time Staffing in Mayfair, specializes in industrial staffing. He notes that monitoring the labor situation is the way to go to follow the trail of unemployment numbers.

“I think that labor in general is a very good indicator for the economy for when it is going to turn around. We usually see it first. There’s an increase in production or there is an increase in amounts of boxes that are being shipped or the amount of trucks that are going out,” Schoeffler said. “Labor is the first indicator that usually comes back. …The unemployment numbers are really going to be lagging behind what temporary labor is really indicating. So I would say that unemployment would start to reduce after we start to get our numbers back.”

Many people don’t believe that the economy is getting any better though, and it is that sort of discouragement that has made potential candidates skeptical about the future.

“I used to do construction, but now I look for general work…I‘m almost three years unemployed,” 25-year-old Mayfair resident Tim Marion said, adding, ” I think the economy is going to get worse in the next few years.”

A Business Week article from earlier this month, titled “Increase in March Employment Shows U.S. Recover Is Broadening” states:

“Private payrolls increased by 123,000 in March, the third consecutive increase and the biggest since May 2007. Employment at government agencies increased by 39,000 workers, reflecting the increase in census staff. Budget-constrained state and local governments reduced headcount last month.”

The article goes on to explain:

“Manufacturers increased staff for a third month, adding to evidence factories are at the forefront of the recovery. Construction companies, which may have been most influenced by the weather, boosted payrolls by 15,000 workers, the first increase since June 2007.”

“I do see a turn with some of our core clients that they are starting to get back to business as usual,” Schoeffler said. “It may not get back to the heyday of 2006-2007, but I do see them responding from where they were in 2009. So It’s definitely coming back a bit.”

With the news that the labor industry is starting to bounce back though, you would think that local employment agencies would have clients and temporary associates lining up at their doors.

In the video below, unemployment agencies and unemployed residents discuss the economy’s effects on their situations.

After telephoning 13 employment offices in the Northeast, we found four agencies were disconnected and no longer in business, one was “not available” for an interview, three were set up to be used as fax numbers only and one company hung up the telephone — twice. Of the three companies that were e-mailed, one referenced its corporate office for public relations inquiries, and two didn’t respond at all.

According to the Associated Press, a survey released on April 7 by the Business Roundtable — an association of CEOs of big U.S. companies —  says 29 percent of chief executives expect to increase corporate payrolls over the next six months, while 21 percent predict their work forces will shrink. Half see no change. That’s the first time in two years that more CEOs have expected to add jobs rather than cut them.

In light of the sluggish economy’s gentle rising, some staffing agencies have mixed reviews of the economic forecast.

“One of our employers two months ago had lay-offs, but now they are busy and full-staffed,” Anthony Schultz, a job developer from Performance Staffing in Frankford. said. Added Wong Nguyen, a bookkeeper at High Quality FRC Temporary Staffing: “Hopefully, it [the economy] gets better.”

But not all employment agencies have high hopes.

“I’m a little skeptical how long-term [full economic recovery] will be. I talk to people who are involved in the hiring process; they are more inclined to talk to people,” said Steve Weinberg, owner of the Franklin Group at 7027 Rutland St. They are more the manager-type. They are looking to get more permission to add people…there is a chain of commands though.”

Most of the agencies said that there has been more difficulty in finding jobs for temporary candidates than ever.

“It’s difficult. I’m in the area of health care. There is less of a shortage of people, but there are fewer jobs,” Weinberg admitted. Schultz said he finds acquiring jobs for candidates “extremely difficult.”

Some of the agencies do the work in finding their potential clients, as well.

“I contact the clients to see what their needs are. There’s an uptick. I talk to directors of pharmacies, who are a little more anxious to hire,” Weinberg said. And he’s not alone. Schultz also reaches out to clients, rather than have them approach him for work.

As the economy slowly rebuilds, employment agencies must find ways to keep their businesses afloat. It seems difficult for companies that look to fill jobs for employers and potential employees to succeed when jobs don’t exist in many general fields.