Chief financial officers have become more optimistic about U.S. employment growth, expecting the unemployment rate to drop below 8% this year.

Respondents to the latest quarterly Duke/CFO Magazine Global Outlook survey expect U.S. employment to increase by 2.1% over the next year, up from 1.5% they predicted last quarter. At that rate, national unemployment should decrease to under 8% by the end of the next 12 months.

More than two-thirds of U.S. CFOs said they are actively trying to fill vacant job slots in multiple departments at their companies. “CFOs are feeling more confident about the year ahead,” said Kate O’Sullivan, senior editor at CFO Magazine, in a telephone interview.

“This rebound is encouraging because increases in CFO optimism have historically preceded improvements in the overall economy,” said John Graham, a professor of finance at Duke’s Fuqua School of Business and director of the survey.

According to the survey, almost half of U.S. CFOs have had a difficult time filling open positions over the past year. As a result, 60% said they would recruit more actively, while 35% will hire a junior person and train them and 34% will raise the offered salary.

The survey polled 847 CFOs from global public and private companies across a broad range of industries, including manufacturing, banking, media and transportation, about their expectations for the economy.

Unlike their U.S. counterparts, CFOs in Europe plan further layoffs this year and expect to reduce workforces by 1.5%. Still, almost half believe this year will be a better year than last when the Greek debt crisis griped eurozone economies. “Optimism also rebounded in Europe and Asia, suggesting that 2012 should be a better year than 2011,” said Graham. “Still, European optimism lags behind the rest of the world.”

Asia is still a good option for jobseekers. CFOs there expect employment to grow in Asia at a rate of nearly 4%, somewhat lower than the 5% they predicted last quarter. Wages are expected to grow by 8% in Asia over the year as companies vie for qualified talent.

“The wage growth shows how competitive the labor market is,” Sullivan said. “Companies are trying to attract and retain people. Their optimism has bounced back.”

• Hiring is heating up in accounting and finance. We’ve known for quite a while that one of the jobs with the lowest unemployment rate is financial analyst. It seems like other finance and accounting positions are catching up.
• Unemployment in the accounting sector is at 5.3% versus a national average of 8.3%
• Consider that the 5.3% rate includes all accounting professionals, so if that rate were dissected into various demographics – years’ experience, progressive career path, right experience, systems, location, etc. – that percentage drops significantly.
• This low rate, combined with a very inactive passive candidate market, make finding the right fit difficult.
• There is plenty of anecdotal evidence that confirms our clients are having a very difficult time finding people who meet their qualifications.

“The finance sector gained 6,000 jobs last month, offsetting the 5,000 it lost in January, according to the Bureau of Labor Statistics. Accounting and bookkeeping gained 7,300 jobs in February, adding more jobs than any other finance sector.

The finance unemployment rate dropped to 5.3% in February, down from 6.9% in the same month a year ago, while the broader economy added 227,000 jobs in February. The unemployment rate remained steady from the previous month at 8.3%.

The accounting job gains fell from 12,500 added in January, but overall hiring remains strong. ‘There’s been a steady demand for technical accounting skills, and while unemployment overall is still high, unemployment for professional accountants is low.’

Employers need accountants with tax, audit and experience with rules of the Securities and Exchange Commission. ‘There are certain accounting jobs companies can’t leave vacant. Certain technical accounting skills are always in demand.’”

Source: fins.com

The survey shows that CFOs would like to devote more time to working with their CEOs as strategists and partners for change. Effectively, CFO’s would like to take almost half the time they spend today wearing the Controller/Accountant hat and devote that time to the Strategy/Business Partner role. Here’s how they say their time is divided now versus how they would like to spend it:

Strategist:  Current – 20%, Desired – 31%

Business Partner:  Current – 22%, Desired – 29%

Controller:  Current – 34%, Desired – 22%

Accountant:  Current – 24%, Desired – 18%

They have been told to submit an updated resume, apply for their position, and wait to receive an offer – same job, mind you, just in a different place on the org chart. They can accept the offer, negotiate, or decline the offer and leave the company. This process applies to everyone below a certain level, regardless of past performance. The person I spoke to has been with the company for over 10 years, has taken on increased levels of responsibility, and received excellent reviews.

What I find hard to believe is that, at a time when great companies are finding ways to show appreciation for their most valuable assets – their people – this company apparently doesn’t care. And then, it hit me: this company’s management is weak, is afraid to make tough decisions, and would rather lose good, committed employees than address head-on the issues with the non-performers. How else could this be explained?

Here’s what will happen; the good employees, the ones they want to keep, find themselves questioning their commitment, wondering if they are valued, harboring hurt feelings, and holding in their hand what they didn’t have before: an updated resume. My contact hadn’t updated their resume in over 10 years and, until recently, hadn’t even considered looking for another job. But now, not only are they TAKING calls from recruiters, they are MAKING calls to recruiters.

This company will lose some very good people. And the ones that stay are likely to be the very people they want to get rid of – because they don’t have options! A lot of institutional knowledge will walk out the door and be replaced by people who may not be as good, whose salaries are equivalent, and whose abilities and commitment are unknown.

Research suggests that, on average, it costs roughly $15-20k to hire a new employee. On average, it takes about 5 months to find and hire a new employee. All-in, the cost to replace just one mid-level employee is 150% of their annual salary.

Unfortunately, in this situation the damage is done. This exercise has clearly had an impact on morale, which in turn has affected productivity and is costing the company money. When the dust settles, it will be interesting to see the long-term effects. Will the quality of the staff improve? Will they achieve cost savings? Will the company maintain their “employer of choice” image? My guess is that these things could have been achieved with less organization stress, not to mention individual stress, if they had simply embraced the top performers and had the guts to implement a corrective action plan for the non-performers.

This would help explain the dearth of passive candidates and the difficulty companies are having in finding talent even as unemployment levels remain high. It also tells me that employees are very motivated to keep their jobs and reinforces the theory that employees are unwilling to change jobs because “the devil they know is better than the devil they don’t know.”

The Sentio Group can help.

Read the full article at CFO.com.

U.S. staffing firms deployed an average of 2.6 million workers per average business day in 2010. That’s 18.4 percent more than in 2009.

In the first quarter of 2011, average daily employment from U.S. staffing firms was 2.6 million, 14.3 percent more than in the same period of the previous year.

“Staffing employment reflects the economy,” said ASA President and CEO Richard Wahlquist. “As the economy emerged from the recession, businesses turned to flexible staffing solutions to meet increases in demand for their products and services. Even with economic growth slowing in the second quarter of this year, staffing companies continue to offer untapped employment opportunities for job seekers. Businesses have been increasingly interested in temporary-to-permanent placements.”

Source: Staffing Industry Analysts

The framework of this multi-step plan anticipates a 5-7 year transition with the goal of minimizing the impact to U.S. issuers while still providing useful information to investors. The paper points out that this approach would potentially allow a more flexible transition as well as minimize the cost of adoption. A copy of this SEC Staff Paper can be found here.