Morgan Philips Group acquires Hudson’s operations in Europe
As we settle into the new year, what can we expect of the U.S. economy for 2016? In December 2015, the U.S. reached full employment at 5% which is expected to continue throughout 2016 averaging an unemployment rate of 4.6%. At full employment, core PCE inflation starts to pick up but despite this trend, the U.S. can anticipate a minimal core inflation rate of 1.6%. Wages have ceased to rise at the level predicted at full employment but private companies anticipate an average wage raise of 3.1%, the first time the number has not been below 3% since 2008. There continues to be unconvincing signs of significant acceleration in wage increases for 2016. The U.S. GDP growth rate is expected to improve averaging 2.3%. Manufacturing is forecasted to increase faster than the general market with production growing to 2.6% in 2016. The U.S. Energy Information Administration predicts crude oil prices to rise to $44/barrel for West Texas Crude and $55.78/barrel for Brent Global. The negative impact of oil industry weakness is expected to subside sharply although gasoline prices are unlikely to increase real income. Optimism surrounds the U.S. housing market as residential construction is expected to rise with single-family starts and sales increasing 16%. Existing-home sales will rise 4% and home prices will be up 5% with some areas experiencing double digit growth. Sales of new homes are still far off the historical average but peaks in building permits signify builders are confident sales will stay firm and potentially increase. The soaring dollar will sharply negatively impact U.S. trade with increased prices for American-made goods. With a slow market, China is curbing its purchases of American goods while Canada is doing much of the same having recently emerged from a light recession. The rising trade deficit will continue through 2016 widening 4%. While significant acceleration is unlikely, we can expect a healthy U.S. economy for 2016. Additional factors remain to be seen with an impending El Niño storm and other natural disasters that will not only affect the communities they touch, but the U.S. economic situation more broadly. What implications do these figures have on the U.S. recruitment industry? At full employment, we can expect a more intensified hunt for talent across the board but more specifically in the fields of information technology, engineering, accountancy, tax and regulatory roles ranging from pharmaceuticals to asset management. While wage inflation is not presumed to be very significant, we have seen and expect to continue seeing wage inflation among technical accountants, engineers, coders, programmers, developers and UX/UI designers. What hiring initiatives is your business anticipating for 2016 and what trends are you seeing in your market? Amelia Van Camp Recruitment Consultant Morgan Philips – Boston, Massachusetts All data was sourced directly from Pictet Wealth Management, IMF and Kiplinger.