What Do Softened Business Expectations Mean for Hiring?
Abstract: n October, we saw a downturn in our Fifth District indexes for expected demand and business conditions over the next six months, especially in the service sector. Employment expectations over the same period, however, remained largely unchanged. This month, firms' six-month expectations for demand and business conditions remained soft, and near-term employment expectations remained steady. Every November, we ask firms for their employment outlook over a longer time horizon: the next 12 months. Longer-run employment expectations also appeared to remain positive. Compared to last year, a similar share of firms plans to increase employment over the next 12 months. Among businesses that plan to increase employment, the most cited reasons were high expected sales growth and overworked staff. While nearly four in 10 respondents plan to hire, businesses reported recent difficulty finding workers with the necessary skills, leading them to seek various ways to meet their workforce needs. Few firms planned to decrease their workforce unless demand for their products and services decreases unexpectedly.
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Description: Discussion Paper
Provider: Federal Reserve Bank of Richmond
Part of Series: Regional Matters
Publication Date: 2023-11-28