32 Percent of U.S. Businesses Plan to Hire Additional Staff in 2011

/PRNewswire/ -- Businesses across the globe are now looking to hire new staff, in one of the first signs that global economic recovery and growth is on a sustainable upward trajectory. This is the key finding of the bi-annual Regus Business Tracker survey that interviews more than 10,000 businesses around the world. The fact that companies are looking to hire additional staff will be regarded as a significant indicator that the mindset of organizations has shifted toward investment in growth through human capital. Regus, a global provider of flexible workplace solutions, found that more than a third of companies [36 percent net(1)] surveyed said they intend to increase headcount. U.S. business was close to the global average with almost a third (32 percent net) of companies preparing to add new staff in 2011.

These findings are particularly significant, coming in the wake of recent observations from the International Monetary Fund (IMF) and International Labour Organization (ILO) that global unemployment has reached record proportions in the last three years (up to 210 million since 2007). These organizations have warned about potential problems for national economies if this trend continues. Unemployment reduces national taxation income and increases public spending. The findings of the Regus Business Tracker provide important evidence that the world unemployment situation may be set to ease in 2011.

The survey canvassed the opinions of more than 10,000 senior business people in 78 countries asking them about their current revenue performance, their profitability, their projected future revenues and their wider expectations of national economic growth. These indicators form the basis for the report's Business Optimism Index, which unusually reflects actual performance as well as near-term outlook. Globally, this edition of the index revealed a far more positive outlook, with a greater proportion of optimist countries than six months ago. For the U.S. in particular, the global index revealed a bullish rating of 87, up seven points on six months ago.

Sande Golgart, regional vice president for Regus, comments: "The intention to increase headcount is a clear indicator that businesses want to be prepared to grasp the opportunities that recovering markets may throw their way. The U.S. in particular is still suffering from high unemployment levels, at 9.6 percent, although private sector payroll continues to increase slightly and this finding should be taken as a positive indication for employment.(2)"

"In spite of this optimism, our research also highlights that 41 percent of companies are still looking to reduce their overhead, through means other than reducing staff. This reveals an attitude of cautious optimism. As companies look to find economies in their own operations, we are likely to see more and more organizations offering flexible working practices to their existing or prospective employees in a bid to achieve a better work-life balance and run a leaner organization."

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Rate of Wage Growth Likely to Turn Around, BNA Index Predicts

/PRNewswire/ -- The pace of wage growth in the private sector likely will pick up in the coming months from recent historic lows, according to the preliminary third quarter Wage Trend Indicator(TM) (WTI) released today by BNA, a leading publisher of specialized news and information.

The WTI rose to 96.97 (second quarter 1976 = 100) from 96.85 in the second quarter. If confirmed by the revised and final readings, it would be the index's first gain in more than two years, ending nine straight quarterly declines, dating back to early 2008.

"The increase in the latest WTI is pointing to an improvement in labor market conditions -- albeit a small one," economist Kathryn Kobe, a consultant who maintains and helped develop BNA's WTI database, said. "The rate of wage increases should show a turnaround in the coming months, but I think it's going to be a slow change in that direction," Kobe said.

Year-over-year wage and salary increases for private sector employees in the coming months are expected to equal or exceed the 1.6 percent recorded over the 12 months ended in June, as measured by the Department of Labor's employment cost index (ECI). During the past year, the rate of annual wage growth has ranged from a record low of 1.4 percent to 1.6 percent.

Reflecting recent labor market conditions, three of the WTI's seven components made positive contributions to the preliminary third quarter reading, while two components were negative and two others were neutral.

Over its history, the WTI has predicted a turning point in wage trends six to nine months before the trends are apparent in the ECI. A sustained decline in the WTI is predictive of a deceleration in the rate of private sector wage increases, while a sustained increase forecasts greater pressure to raise wages.

Contributions of Components

Of the WTI's seven components, the three positive components in the preliminary third quarter reading were job losers as a share of the labor force, from DOL; industrial production, measured by the Federal Reserve Board; and the share of employers planning to hire production and service workers in the coming months, also shown in BNA's quarterly Employment Outlook Survey. The negative contributors were the unemployment rate, reported by DOL, and economic forecasters' expectations for the rate of inflation, compiled by the Federal Reserve Bank of Philadelphia. Two components were neutral: the proportion of employers reporting difficulty in filling professional and technical jobs, tracked by BNA's employment survey, and average hourly earnings of production and nonsupervisory workers, from DOL.

BNA's Wage Trend Indicator(TM) is designed to serve as a yardstick for employers, analysts, and policymakers to identify turning points in private sector wage patterns. It also provides timely information for business and human resource analysts and executives as they plan for year-to-year changes in compensation costs.

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