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What 5.9% Unemployment Means to You

Posted on October 3, 2014 by Don MacPherson.

For the first time in more than six years, unemployment in the United States has fallen below six percent. A significant psychological barrier has been overcome and depending on who you are this milestone may have significant meaning. Here are a few perspectives:

CEOs and CHROs

If you are an executive, get ready to battle because the war for talent is back on. You need to make sure your employment brand is strong so you will be able to recruit the talent necessary to help your organization succeed.

You will need to change your expectations about pay raises. Median salary increases have been averaging 3% over the last four years. A return to 2007 and 2008, when wage increases increased to nearly 4%, should be anticipated and you will need to be very aggressive with your top talent and high potentials.

Finally, make sure your employee engagement strategy is in place because recruiters and competitors are going to be coming after your disenchanted high performers. If they are not engaged, they will definitely be listening to legitimate offers.

If you are a Millennial

Your time is here. For years, business leaders have maligned you. They have said you can’t be engaged, you are entitled, and you lack work ethic. Many of you have been under-employed. This ends now. Going forward, you will be coveted. Get ready for the respect you deserve and the opportunities that are on the horizon.

If you are political

If you are conservative, get ready to hear your candidates say the unemployment rate is at its current level because so many long-term unemployed have stopped looking for work. If you are liberal, you will be told that the stimulus worked and your candidates are responsible for the drop in unemployment from a high that exceeded 10% in 2009.

Regardless of your political affiliation, you will be inundated by political ads over the next month as the mid-term Congressional elections approach. The meaning of 5.9% unemployment will be hotly debated.

If you are an investor

You responded very favorable today by pushing the Dow up more than 200 points. Keep that war for talent in mind, though. The companies that are going to flourish are the ones that have created healthy cultures for their employees. Product is important. Sales and marketing are critical. Nothing, however, is going to protect and grow your investment more in a knowledge economy than effective management supported by a strong employee culture. Keep a discerning eye on how the leaders of the companies in which you are invested foster their cultures.

 

Do you care about company culture? Modern Survey does. We measure our clients’ employee engagement and the other elements of the employee life cycle. To learn more, please go to http://www.modernsurvey.com/solutions or email ask@modernsurvey.com.

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