If you're looking for work–or looking for a better job–now would be a good time to start sending out those resumes. That's because the labor market, after steadily accelerating for several months, is finally on the verge of shifting into fifth gear.
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To be sure, companies haven't been shy of hiring lately. After creating 179,000 new jobs per month in the fourth quarter of 2005, the economy sped things up and churned out 197,000 new positions a month on average in the first three months of this year.
But one of the reasons that companies have been willing to hire is that they've been simultaneously laying off existing staff to make room for some of those new employees. It's all part of corporate America's ongoing effort to trim costs and improve productivity.
The good news is, companies appear to be wielding a smaller ax now.
According to a new report released this morning, U.S. companies announced only 59,688 layoffs last month, which was down more than 8 percent from March's tally of 64,975 job cuts. This marks the fourth consecutive month of gradually diminishing layoffs, according to the outplacement firm Challenger, Gray & Christmas.
So far this year, 315,566 total job cuts have been announced, which is down nearly 9 percent from the same period last year. And a great many of those cuts–nearly 56,000–have come from one industry: the automakers.
"The slowdown in job cuts is a product of the strong economic performance in the first quarter," said Challenger Chief Executive John Challenger. He noted that the economy grew at an annual rate of 4.8 percent in the first quarter of 2006, which was the fastest rate of growth in 2½ years. "Consumers are more confident, and business leaders are more confident and are focusing on worker retention," he added.
Of course, not everything is rosy for workers.
"The expectation that a tight labor market automatically means higher wages is not working now," Challenger said. "Simply put, until employers can sell the idea to customers that prices must go up, wage hikes will be few and far between."
Making wage increases a tougher sell will be high gasoline and energy prices, he added.
