The Ongoing Impact of the Recession - Professional Services Industry

SHRM Poll: The Ongoing Impact of the
Recession—Professional Services
Industry
July 31, 2012

The Ongoing Impact of the Recession:
Professional Services

Introduction
Key Findings
Organizations’ Financial Health
Hiring
Recruiting Challenges
Demographics
Methodology

SHRM Poll: The Ongoing Impact of the Recession—Professional Services Industry ©SHRM 2012
2

Introduction

 Overall results have been released in three different topic areas:
 Recruiting and skill gaps (released November 7, 2011).
 Overall financial health and hiring (released November 22, 2011).
 Global competition and hiring strategies (released December 14, 2011).

 Industry-specific results are reported separately for each of the eight industries
included in the sample. These findings cover the results for the professional
services industry. The following industries were also included in the sample:
 Construction, mining, oil and gas (released March 9, 2012).
 Manufacturing (released April 4, 2012).
 Federal government (released June 4, 2012).
 State and local government (released June 4, 2012).
 Finance (released June 4, 2012).
 High-tech (released July 31, 2012).
 Health.

3

Key Findings: Organizations’ Financial Health

 What percentage of staff have organizations laid off since the U.S. and global
recession began in December 2007? In 2011, 30% of organizations from the
professional services industry indicated they had not laid off any staff since the
recession began. Forty-six percent had lost between 1% and 10% of their staff. In
total for 2011, about three-quarters (76%) of organizations in the professional
services industry laid off 0% to 10% of staff, an improvement compared with 2010
when fewer organizations (61%) reported losing less than 10% of employees since
the recession began in December 2007.

 How does the financial health of organizations compare to 12 months ago? Nearly
one-half (47%) of organizations in the professional services industry reported being
in a mild or significant recovery in 2011, unchanged from 2010. About one-quarter
(26%) indicated no change compared with a year ago, and the remaining 27% were
in a significant or mild decline. The professional services industry is more likely to be
in a significant recovery compared with state and local governments.

4

Key Findings: Hiring

 Are organizations currently hiring? Just under three-quarters (71%) of organizations
from the professional services industry were hiring in 2011, an increase from 58% in
2010. The majority (78%) of organizations hired nonmanagement salaried
employees, and three-fifths (60%) hired nonmanagement hourly employees. Just
over one-half (53%) hired other management-level staff, and 18% hired executive or
upper-management employees. The professional services industry is more likely to
be hiring nonmanagement salaried employees than the state and local
government, health, and manufacturing industries.

 Are organizations creating new positions or replacing jobs lost? Nearly one-half
(47%) of organizations in the professional services industry indicated they mainly
hired direct replacements of jobs lost, an increase from 29% in 2010. Fewer
organizations in the professional services industry indicated they mainly hired for
completely new positions in 2011 (39%) than in 2010 (55%), whereas the remaining
14% in 2011 and 16% in 2010 hired for positions with new duties added to jobs lost
since the recession began.

5

Key Findings: Recruiting Challenges

 Is it difficult to find qualified individuals for new jobs that require new and
different skill sets? Three in five (60%) organizations in the professional services
industry found it somewhat or very difficult to recruit qualified candidates for these
new positions, an increase from 45% in 2010.

 Is recruiting for specific jobs difficult in the current labor market? Among the
professional service industry organizations that are currently hiring full-time staff,
over one-half (57%) reported having difficulty recruiting for specific open jobs.

 What types of jobs are the most difficult to fill? The top five most difficult positions
to fill for the professional services industry are engineers (88%), scientists (88%),
high-skilled technical (e.g., technicians and programmers) (83%), managers and
executives (80%), and sales representatives (72%).

6


Organizations’ Financial Health

7

Thus far, what percentage of full-time jobs have been lost at your
organization since the U.S. and global recession began in December
2007? Professional Services

Not applicable—did not lay off any 30% 2011 (n = 352)
staff 2010 (n = 334)
28% 76%
1% to 5% of staff

18%
6% to 10% of staff

10% or less (2011 data) 76%
Less than 10% (2010 data)* 61%

11% to 20% of staff (2011 data) 13%
10% to 20% (2010 data)* 25%

10%
21% to 50% of staff
12%

2%
More than 50% of staff
2%

Note: Percentages may not total 100% due to rounding. An asterisk (*) indicates 2010 data had different categories than 2011 data: “Less than 10% of staff”
and “10% to 20% of staff.”
8

Thus far, what percentage of full-time jobs have been lost at your
organization since the U.S. and global recession began in December
2007? Professional Services

Comparisons by Industry

The federal government and the finance industries are more likely to have had no layoffs compared with the
construction, mining, oil and gas; manufacturing; state and local government; professional services; and high-tech industries.

Construction, mining, oil and gas (20%)
. . . are more likely to Manufacturing (21%)
Federal government (50%)
have had NO layoffs State and local government (30%)
Finance (45%)
than . . . Services—professional (30%)
High-tech (29%)

The construction, mining, oil and gas industry is more likely to have lost more than 50% of staff compared with the federal
government, finance, manufacturing, professional services and high-tech industries.

. . . is more likely to Finance (0%)
Construction, mining, oil and gas (10%) have lost more than 50% of staff Manufacturing (2%)
High-tech (3%)

Note: Only statistically significant differences are shown.

9

In relation to the U.S. and global recession, would you say your
organization's overall financial health is declining or recovering
compared with 12 months ago?

10% 2011 (n = 353)
In a significant recovery
7% 2010 (n = 334)

37%
In a mild recovery
40%

26%
No change compared with 12 months ago
27%

22%
In a mild decline
21%

5%
In a significant decline
5%

10

In relation to the U.S. and global recession, would you say your
organization's overall financial health is declining or recovering
compared with 12 months ago?
The professional services industry is more likely to be in a significant recovery compared with the state and local governments.

. . . is more likely to
Services—professional (10%) be in a significant recovery State and local government (1%)
than . . .

The professional services industry is more likely to be in a mild recovery compared with the federal government and with state
and local governments.

Services—professional (37%) be in a mild recovery
State and local government (25%)
than . . .

The federal government and state and local governments are more likely to be in a significant decline compared with the
finance, manufacturing, professional services and high-tech industries.

Finance (3%)
. . . are more likely to
Federal government (29%) Manufacturing (4%)
be in a significant decline
State and local government (13%) Services—professional (5%)
than . . .
High-tech (4%)

11


Hiring

12

Is your organization currently hiring full-time staff?

71%
Yes
58%

2011 (n = 356)
2010 (n = 326)

29%
No
42%

13

Is your organization currently hiring full-time staff?


The health industry is more likely to be currently hiring full-time staff compared with the construction, mining, oil and gas; federal
government; and professional services industries.

. . . is more likely to Construction, mining, oil and gas (66%)
Health (89%) be currently hiring full-time staff Federal government (68%)


14

At what level(s) is your organization hiring?

Nonmanagement salaried employees 78%

Nonmanagement hourly employees 60%

Other management (e.g., directors, managers) 53%

Executive/upper management (e.g., CEO, CFO) 18%

Note: n = 252. Percentages do not total 100% due to multiple response options. Only respondents whose organizations were currently hiring full-time staff
were asked this question.
15

At what level(s) is your organization hiring?


The federal government and health industries are more likely to be hiring executive/upper-management employees compared with
the construction, mining, oil and gas; finance; manufacturing; professional services; and high-tech industries.

Finance (19%)
Federal government (39%) be hiring executive/upper-
Manufacturing (20%)
Health (39%) management employees
Services—professional (18%)
than . . .
High-tech (16%)

The professional services industry is more likely to be hiring nonmanagement salaried employees compared with the
health, manufacturing, and state and local government industries.
Health (60%)
be hiring nonmanagement salaried
Services—professional (78%) Manufacturing (64%)
employees
than . . .


16

At what level(s) is your organization hiring? (continued)


The finance, health, manufacturing, and state and local government industries are more likely to be hiring nonmanagement hourly
employees compared with the federal government, professional services and high-tech industries.

Finance (77%) . . . are more likely to
Health (89%) be hiring nonmanagement hourly
Manufacturing (84%) employees
High-tech (51%)
State and local government (80%) than . . .


17

Which of the following best describes the nature of full-time positions
your organization is currently hiring?

39%
Completely new positions
55%

14%
New duties added to jobs lost (e.g., due to 2011 (n = 251)
layoffs, attrition) since the recession began 2010 (n = 181)
16%

47%
Direct replacements of jobs lost (e.g., due to
layoffs, attrition) since the recession began
29%

Note: Only respondents whose organizations were currently hiring full-time staff were asked this question.

18

Which of the following best describes the nature of full-time positions
your organization is currently hiring?


The federal government and state and local governments are more likely to be hiring direct replacements of jobs lost since the
recession began compared with the professional services industry.

Federal government (69%) be hiring direct replacements of jobs
State and local government (80%) lost since the recession began
than . . .

The professional services industry is more likely to be hiring for completely new positions compared with state and local
governments.

be hiring for completely new
Services—professional (39%) State and local government (12%)
positions
than . . .


19

Compared with the skills required for jobs lost since the recession
began, do these completely new positions require any of the following
skills?

A mixture of new skills and the same
47%
types of skills

Approximately the same types of
28%
skills

Completely new and different skills 24%

Note: n = 95. Percentages do not total 100% due to rounding. Only respondents whose organizations were hiring full-time staff for “completely new
positions” were asked this question.

20


Recruiting Challenges

21

If the new jobs being created by your organization require new and
different skill sets, how easy do you think it will be—or has been thus
far—to find qualified individuals for those positions?

5%
Very easy 2011 (n = 100)
12%
2010 (n = 118)

35%
Somewhat easy
43%

50%
Somewhat difficult
41%

10%
Very difficult
4%

Note: Only respondents whose organizations were hiring full-time staff for positions with “new duties added to jobs lost” or “completely new positions” (see
slide 18) that required either “a mixture of new skills and the same types of skills” or “completely new and different skills” (see slide 20) were asked this
question.
22

In general, in the current labor market, is your organization having a
difficult time recruiting for specific jobs that are open in your
organization?

No, 43%

Yes, 57%

Note: n = 234. Respondents who answered “Don’t know” were excluded from this analysis. Only respondents whose organizations were currently hiring full-
time staff were asked this question.
23

In general, in the current labor market, is your organization having a
difficult time recruiting for specific jobs that are open in your
organization?

The manufacturing, professional services and high-tech industries are more likely to be having difficulty recruiting for specific jobs
compared with the federal government and state and local governments.

Manufacturing (68%) be having difficulty recruiting for
Services—professional (57%) specific jobs that are open in their
High-tech (71%) organization
than . . .


24

Do you believe that your organization is facing global competition (i.e.,
competition from other countries) for jobs that your organization is
having difficulty filling?

Yes, 21%

No, 79%

Note: n = 119. Respondents who answered “Don’t know” were excluded from this analysis. Only respondents whose organizations were having a difficult
time recruiting for specific jobs were asked this question.
25

Do you believe that your organization is facing global competition
(i.e., competition from other countries) for jobs that your organization
is having difficulty filling?


The professional services industry is more likely to believe that their organization is facing global competition compared with the
state and local governments.

believe that their organization is
Services—professional (21%) State and local government (4%)
facing global competition
than . . .

The high-tech industry is more likely to believe that their organization is facing global competition compared with the finance, state
and local government, and professional services industries.

Finance (8%)
believe that their organization is
High-tech (42%) State and local government (4%)
facing global competition
than . . .


26

Has your organization hired any workers from outside the U.S. in an
attempt to fill key jobs that have been difficult to fill?

No 68%

Yes 25%

No, but we are
5%
considering it

No, but we have
plans to do so in
2%
the next 12
months

Note: n = 130. Respondents who answered “Don’t know” were excluded from this analysis. Only respondents whose organizations were having a difficult
time recruiting for specific jobs were asked this question.

27

Has your organization hired any workers from outside the U.S. in an
attempt to fill key jobs that have been difficult to fill?


The construction, mining, oil and gas; manufacturing; professional services; and high-tech industries are more likely to have hired
workers from outside the U.S. in an attempt to recruit for hard-to-fill jobs compared with the finance industry.

Construction, mining, oil and gas (31%) . . . are more likely to
Manufacturing (20%) have hired workers from
Finance (5%)
Services—professional (25%) outside the U.S.
High-tech (50%) than . . .


28

Has your organization hired any U.S. veterans in an attempt to fill key
jobs that have been difficult to fill?

No 52%

Yes 38%

No, but we are
6%
considering it

No, but we have
plans to do so in the 5%
next 12 months

Note: n = 106. Percentages do not total 100% due to rounding. Respondents who answered “Don’t know” were excluded from this analysis. Only respondents
whose organizations were having a difficult time recruiting for specific jobs were asked this question.

29


The construction, mining, oil and gas; federal government; health; manufacturing; state and local government; professional services;
and high-tech industries are more likely to have hired U.S. veterans in an attempt to recruit for hard-to-fill jobs compared with
those from the finance industry.

Health (42%) . . . are more likely to
Manufacturing (44%) have hired U.S. veterans Finance (13%)
State and local government (37%) than . . .
High-tech (34%)


30


Comparisons by Industry (continued)

The federal government is more likely to have hired U.S. veterans in an attempt to recruit for hard-to-fill jobs compared with
the construction, mining, oil and gas; finance; health; manufacturing; state and local government; professional services; and
high-tech industries.

Finance (13%)
. . . is more likely to Health (42%)
Federal government (96%) have hired U.S. veterans Manufacturing (44%)
than . . . State and local government (37%)
High-tech (34%)


31

In general, what basic skills/knowledge gaps do job applicants have in
your industry?

Writing in English (grammar, spelling, etc.) 47%

Mathematics (computation) 24%

Science 24%

English language (spoken) 22%

Reading comprehension (in English) 16%

Foreign languages 8%

Technical (computer, engineering, mechanical, etc.) 8%

Government/economics 7%

Humanities/arts 1%

History/geography 0%

Other 13%

Note: n = 85. Percentages do not total 100% due to multiple response options. Only respondents whose organizations were having a difficult time recruiting
for specific jobs were asked this question.
32

In general, what applied skill gaps do job applicants have in your
industry?

Critical thinking/problem solving 43%
Professionalism/work ethic 43%
Written communications 32%
Leadership 30%
Oral communications 28%
Teamwork/collaboration 28%
Information technology application 27%
Creativity/innovation 19%
Lifelong learning/self-direction 15%
Diversity 10%
Ethics/social responsibility 8%
Other 4%

Note: n = 115. Percentages do not total 100% due to multiple response options. Only respondents whose organizations were having a difficult time recruiting
for specific jobs were asked this question.
33

Specific Job Categories in Which Organizations Have Difficulty Recruiting

Engineers (n = 58) 88%

Scientists (n = 25) 88%

High-skilled technical (e.g., technicians, programmers) (n = 89) 83%

Managers and executives (n = 96) 80%

Sales representatives (n = 43) 72%

Skilled trades (n = 27) 61%

Accounting and finance professionals (n = 82) 52%

Production operators (n = 20) 45%

Customer service representatives (n = 40) 38%

HR professionals (n = 61) 37%

Administrative support staff (n = 96) 29%

Hourly laborers (n = 41) 22%

Note: Chart represents “somewhat difficult” and “very difficult” responses. “Not applicable” responses were excluded from this analysis. Only respondents
whose organizations were having a difficult time recruiting for specific jobs were asked this question. No statistics are provided where the n is less than 20;
therefore, the job categories of “drivers” (n = 15) and “high-skilled medical” (n = 16) were excluded from this analysis.
34


Demographics

35

Demographics: Organization Sector

Privately owned for-profit 76%

Publicly owned for-profit 16%

Nonprofit 6%

Government 0%

Other 2%

n = 340

36

Demographics: Organization Staff Size

1 to 99 employees 40%

100 to 499 employees 29%

500 to 2,499 employees 19%

2,500 to 24,999 employees 9%

25,000 or more employees 3%

n = 335

37

Demographics: Other

Does your organization have U.S.- Is your organization a single-unit organization
based operations (business units) only, or a multi-unit organization?
or does it operate multinationally? Single-unit organization: An organization in
which the location and the organization are 39%
U.S.-based operations only 71% one and the same.

Multinational operations 29% Multi-unit organization: An organization
61%
that has more than one location.
n = 345
n = 348

For multi-unit organizations, are HR policies and
What is the HR department/function practices determined by the multi-unit
for which you responded throughout headquarters, by each work location or by both?
this survey?
Multi-unit headquarters determines HR
64%
policies and practices.
Corporate (companywide) 73%
Each work location determines HR policies
Business unit/division 20% 4%
and practices.

Facility/location 7% A combination of both the work location
and the multi-unit headquarters 32%
n = 226
determines HR policies and practices.

n = 227

38

SHRM Poll: The Ongoing Impact of the Recession:

Methodology
 Response rate = 12%.
 Sample composed of 356 randomly selected HR professionals from the professional
service industry in SHRM’s membership.
 Margin of error +/-5%.

 Survey fielded August 18 to September 2, 2011.

For more poll findings, visit www.shrm.org/surveys
Follow us on Twitter: http://twitter.com/SHRM_Research

Project leader:
Tanya A. Mulvey, survey research analyst, SHRM Research

Project contributors:
Mark Schmit, Ph.D., SPHR, vice president, SHRM Research
Evren Esen, manager, Survey Research Center, SHRM Research

Copy editor:
Katya Scanlan, SHRM Knowledge Center
39

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