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Area job market strong, but far less than perfect

Outlook

Area job market strong, but far less than perfect

Capital Region ended 2016 with unemployment rate of 4 percent
Area job market strong, but far less than perfect
Job fair at Saratoga Springs City Center on June 11, 2015.
Photographer: Daily Gazette file photo

Unemployment across the Capital Region is low, but that does not mean everything is great in the local job market.

There is work for most people who want a job, but the job a particular applicant wants may not exist, or may not pay as much as expected, or may be beyond the skills and experience the applicant possesses.

The Capital Region ended 2016 with an unemployment rate of 4.0 percent, according to the state Department of Labor, and begins 2017 with a good hiring outlook, according to several local officials involved with the regions’s workforce and economy.


Related: Outlook 2017, The Gazette's annual guide to business and technology in the Capital Region


Thinking as a region

Andrew Kennedy, president and CEO of the Albany-based Center for Economic Growth, said the perennial problem for this region is the percentage of its young people who graduate college and leave to start their careers elsewhere, causing the Capital Region workforce to age and shrink.

“It challenges us as a region and me as head of CEG — what can we do to keep [young people] in the region?” he said. “As a region, we’ve got to do a better job keeping those graduates, that new talent, here in the region.”

Kennedy said jobs go unfilled because of mistakes on both sides of the desk: Applicants present themselves for jobs that they are not qualified to perform and employers offer salaries that are too low for the qualifications they are seeking.

This also contributes to the outflow of young people: Without a mortgage or children in school, there’s not a lot holding them here if an employer in another state is offering a lot more money.

Employers low-balling their salary offers need to realize that “the people that have those skills may want to go someplace else,” Kennedy said.

CEG, in its efforts to promote economic development in the Capital Region, has produced comparisons of salary and cost of living in job markets across the nation that put this area in a favorable light: A higher salary elsewhere can be eaten up quickly by higher housing costs, for example.

But the more effective strategy, Kennedy said, will likely be to sell people on all this region has going for it.

External factors

There’s a lot of speculation about what changes President Trump will make and what effect they will have, but not much in the way of actual results one month into his administration.

Zack Hutchins, director of communications at the Business Council of New York state, said: “There’s still a lot of question marks about what we’re going to see come down federally.”

Two of the bigger questions for the business community are whether taxes will be cut and whether trade barriers will be created, he said.

One would presumably be very positive for business, one potentially very negative, he continued. But it’s unclear if either will happen — or if both will happen, and potentially cancel each other out.

“I don’t think anyone knows right now,” Hutchins said.

He said there are signs for optimism at the state Capitol as the tumult in Washington continues:

  • Top state Democrats, while positioning themselves as anti-Trump on social issues, have maintained their commitment to business growth in New York.
  • The Clean Water Infrastructure Act of 2017 recently proposed by Gov. Cuomo would create jobs and foster future growth.
  • There appears to be wide support for continuing the state-imposed cap on local property taxes, which are the largest single tax bill facing businesses.

Another interesting barometer, Hutchins said, was the Upstate New York Business Leader Survey, a Siena Research Institute poll sponsored by the Business Council. Results were released in January.

It found that confidence among CEOs was at a 10-year high in the Capital Region; across upstate, CEOs expected to see revenue, profits and hiring increase. They said the cost of health care, taxes and government regulations hurt them, and expressed confidence the new administration in Washington would improve the economy.

Hutchins marveled at the changes in CEOs’ opinion of government. Only 15 percent were confident state leaders are able to improve the business climate, up from 13 percent the year before. But 32 percent were confident in federal leaders, up from just 7 percent the year before.

The percentage of CEOs with a favorable view of local governments was unchanged at 19 percent.

Tech tech tech

Technology isn’t the largest job sector but it gets a lot of attention because the jobs pay well and will exist for the foreseeable future; indeed, it is the future, by some definitions. However, it is a very broad category, and people cannot move into it or around in it without training, experience and preparation.

Miriam Dushane, managing director of the Albany Recruitment Division of Linium, said the greatest demand by clients of her Colonie-based recruiting firm is for information technology, engineering and science employees, in that order. Within IT, top specialities are in software/app development and network infrastructure, support and security.

The Linium Index of High-Tech Hiring, a quarterly hiring survey the company began conducting in 2015, shows continued optimism that there will be new jobs to fill in the Capital Region and continued pessimism that these openings would be easy to fill, Dushane said: More than 50 percent of companies responding to the most recent survey said they would increase their technology workforce in 2017 and 82 percent said they’ve had trouble finding the right people.

Previous surveys have found similar results, she said. “I think salaries still remain an issue.”

The salaries being offered, she explained, are “not in line with what the market is going for.”

A manager at one client company actually told her that the salary being offered was chosen by guesswork.

Other employers are trying to conserve their budgets, and still others simply don’t know what a competitive salary would be for a particular job description, Dushane said, because there is such a range of small to large employers in the region, plus state government, which further skews the compensation scale.

As employers have trouble filling specialized posts because they aren’t offering enough money, workers have trouble getting hired because they have the wrong skill set, she said.
Job seekers need to keep current in their fields and evolve to qualify for that next job, Dushane advised.

“You have to be continuously growing your skills,” she said. One way to do this is to update a resume at least annually — it’s an exercise in self-evaluation that points out areas in need of improvement. The time to do this is not when you want or need a new job, but when you are happy in your current job.

“I update my resume once a year and I’m not going anywhere,” said Dushane.

Down on Main Street

Another major job sector is retail — but don’t look for a lot of changes there, advised the head of the industry trade association in New York state.

As long as there are shoppers, there will be job opportunities, said Ted Potrikus, president and CEO of the Retail Council of New York State — this is because retail jobs have a fairly steady turnover rate.

“If you take a look around you’ll see signs, particularly in the larger stores: ‘We’re hiring,’” he said.

But it’s the steady churn, rather than the stampede caused when new retail operations come online.

“We’re not in a period where we’re seeing huge numbers of people being hired,” he said.

Amid the steady turnover is an effort to keep the best employees — those who like selling things and are good at it — on the job and move them up through the ranks.

“Those stores are always looking to find ways to make sure the people that are good at the job, that there’s a track to make this a career,” Potrikus said.

It’s not easy because retail positions are usually lower-wage jobs, often viewed as a good first job and as a good part-time job while going to school or searching for the right post with that new diploma.

“It’s hard to get people to stay,” Potrikus said.

A big factor affecting the retail sector this year, workers and employers alike, is the minimum wage increase enacted last year in New York.

It’s potentially a double-edged sword for the industry, Potrikus said: The higher wages may attract more or better employees, and may make it harder for retailers to hire as many workers.

“That’s one of the things we talked about as an industry long and hard last year as the minimum wage debate heated up,” Potrikus said. “Two very distinct schools of thought — there was no middle ground.”

His own opinion?

“I think it remains to be seen.”

Like the other leaders who spoke to The Gazette for this story, Potrikus is also waiting to see what the new administration does, and what happens as a result: Income tax cuts would increase consumers’ spending power, taxes on imports would decrease it; an economic boom would increase their willingness to spend, a recession would decrease it. Retailers’ prospects would follow accordingly.

“The retail industry to a considerable extent is highly discretionary spending and highly dependent on how shoppers feel in the moment,” he said.

“I think we’re in a wait-and-see mode like everyone else is. Anybody out there that has a crystal ball, I’d love to take a look at it.”

Read more about business in the Capital Region

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