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U.S. Service Companies Expanded in May

Associated Press (06/05/12) Martin Crutsinger

U.S. service companies grew at a slightly faster pace in May, marking the 29th straight month of expansion. The Institute for Supply Management’s index of nonmanufacturing activity edged up to 53.7 last month from an April reading of 53.5. The May reading was slightly below the long-run average for the index of 53.9. A reading above 50 indicates expansion. Economists said the increase in the new orders component of the index is a good sign that demand will be solid in coming months. They expressed concern, however, that the employment component, while remaining in expansion territory, slipped to the lowest reading since November.

Wal-Mart Is Driving Down Wages for Warehouse Workers, Report Says

Los Angeles Times (06/06/12) Marc Lifsher

A new report by the National Employment Law Project says wages and benefits for U.S. warehouse workers are on the decline as a result of aggressive cost cutting by Wal-Mart Stores Inc., which has outsourced its supply chain and relies on third-party companies for warehouse operations and transport, which depend on low-wage temporary workers. The report indicates that Wal-Mart’s competitors are now demanding similarly low prices from logistics companies, reducing the quality of warehouse jobs nationwide. According to the report, “Outsourcing and other contingent work models like ‘permatemping’ have become increasingly standard in the industry.”

Defense Chiefs Signal Job Cuts

Wall Street Journal (06/06/12) Nathan Hodge

U.S. defense contractors are preparing to disclose major job cutbacks ahead of the November elections if Congress fails to reach a deficit-reduction deal by then. Firms including Lockheed Martin Corp. and Northrop Grumman Corp. may lay off thousands of workers at the beginning of 2013, when more than $50 billion in new defense cuts could take effect—along with similar reductions across federal agencies.

Defense manufacturers and their suppliers employ around one million workers combined. Defense industry officials say that they will have to notify employees of potential layoffs 60 or 90 days ahead of time, in line with state and federal plant-closing laws. The Worker Adjustment and Retraining and Notification Act requires companies to notify employees in advance of mass layoffs and plant closings.

U.S. Productivity Fell 0.9% in First Quarter as Growth Cooled

Bloomberg (06/06/12) Alex Kowalski

The productivity of U.S. workers dropped at the fastest pace in a year in the first quarter, the U.S. Department of Labor reported today, indicating companies may pause before bringing on new employees. Nonfarm productivity decreased at a 0.9% annual pace, faster than the initial estimate of an annual rate of decline of 0.5%. The drop in productivity at the beginning of the year helps explain why payroll gains in May were the weakest in a year. Slower U.S. growth combined with European economies on the verge of recession shows why companies may cut back worker hours and become more deliberate in their hiring.

Fed Presidents Clash Over Need to Provide More Stimulus

Bloomberg (06/06/12) Caroline Salas Gage; Jeff Kearns

Chicago Federal Reserve president Charles Evans insists that “extremely strong accommodation” is needed in response to soft economic data and that the U.S. Federal Reserve should state that interest rates will be held down unless the unemployment rate dips under 7% or inflation jumps above 3% during “the medium term.” However, Dallas Federal Reserve president Richard Fisher opposes more bond purchases by the central bank because it would do little to help the economy. Meanwhile, St. Louis Federal Reserve president James Bullard says more time should be taken to assess the economy before moving forward with policy change, noting that the economic outlook has not been altered by the recent payroll data.

Free ASAPro Webinar Tomorrow—The Art of Social Recruiting

Tomorrow afternoon from 3 to 4 p.m. Eastern time, get tips on networking with passive candidates and connecting with high-caliber talent from human resource consultant Peter Weddle during the ASAPro Webinar “Persuade Passive Candidates Using the Art of Social Recruiting.”

ASAPro Webinars are free for ASA members ($295 for nonmembers) and qualify for continuing education hours toward ASA certification renewal. Register online at

Understand Unemployment Insurance Issues

The National UI Issues Conference takes place in two weeks: June 20–22 in Denver. The conference, presented by UWC–Strategic Services on Unemployment and Workers’ Compensation, explores the major unemployment insurance issues that businesses face every day.

ASA government affairs counsel Toby Malara will join Lisa Harris, director of accounting for TrueBlue, and Matt Harvill, vice president for unemployment at Kelly Services, to facilitate a workshop on UI issues that staffing firms face. They will focus on best practices in forecasting state unemployment tax costs, and how firms can communicate with, educate, and prepare their clients for rising costs. For more information and to register, visit

Should Changing Into Work Clothes and Walking to Worksite Be Paid?

HumanResourcesJournal (06/04/2012)

In a lawsuit filed against Gary, IN-based U.S. Steel, 800 current and former hourly employees accused the company of violating the federal Fair Labor Standards Act by failing to compensate workers for time spent changing into work clothes and walking to and from their work stations. The district court noted that under the FLSA, changing clothes was not compensable, but it indicated that time spent walking to work stations might be compensable. However, an appeals court later determined that the collective bargaining agreement, which does not call for compensation for clothes changes, should be followed because the FLSA does not cover such activity. Moreover, time spent walking to work stations is not compensable because the collective bargaining agreement does not consider clothes changes a principal activity, meaning that the work day starts when employees reach their stations.

Professors Say New York Governor Cuomo Can Hike Minimum Wage on His Own

Associated Press (06/05/12)

Progressive groups pushing for a minimum wage increase in the state of New York are citing comments by Yale and Fordham professors who argue that Gov. Andrew Cuomo’s labor department already has the power to increase it. “It’s not a close call at all,” says professor Michael Wishnie of Yale Law School. He says New York and several other states have provisions of law to raise the minimum wage in the face of a changing economy that can be less costly, faster, and less political than setting wages through legislatures.

Cuomo says he supports increasing the wage to $8.50 from the current $7.25 an hour, but New York has never bumped it up for all workers without the state legislature’s consent. The state senate’s Republican majority flatly opposes the measure as a “job killer.” The regular legislative session ends June 21. New York has in the past used the law to raise the minimum for most if not all labor sectors individually, says professor Jennifer Gordon of Fordham University School of Law.

Seeking Software Fix for Job-Search Game

Wall Street Journal (06/06/12) Lauren Weber

Companies are expected to spend $5.75 billion on online recruitment in 2012, and their outlays could climb to as high as $10.4 billion by 2016 if the weak job market recovers to normal levels, according to market-research firm Borrell Associates Inc. Web-based job-hunting tools have left human resource departments with too many résumés and have given job seekers the sense that applying online is a waste of their time. Technology firms of all sizes are trying to develop software that can read résumés intelligently, flagging a handful of truly promising candidates to recruiters, and alerting job seekers to openings that are specifically targeted to their skills and background.

Pioneering online job boards such as the ones developed by ASA corporate partners and CareerBuilder are also rushing to reposition themselves with social-media apps and search algorithms designed to sort résumés in a more nuanced way than the original keyword-based model. is staking its future on a version of semantic search called 6Sense, used in its SeeMore and Power Resume Search products. The second approach works like online dating services, requiring job seekers and sometimes recruiters to fill out detailed profiles or questionnaires about their goals so that the software can suggest potential matches.

“If you create tools that allow recruiters to spend more quality time with a smaller number of high-quality people, that’s valuable,” says Michael Pope, founder of San Francisco recruiting firm Captain Recruiter. But that tool first needs to earn the trust of job seekers, recruiters and employers. So far, he notes, “there isn’t anybody that tries to empower all three sides at once to be more effective.”

LinkedIn Tops Social Sites for Recruiting: Report

Workforce Management (06/12)

LinkedIn is the most popular social media site for posting jobs, according to a new report from Bullhorn Inc., a software-as-a-service provider for recruitment. Approximately 77% of job openings are shared on LinkedIn, followed by Twitter at 54%, and Facebook at 25%. The study also found that 21% of jobs are posted to all three social networks and that the same percentage of jobs are not posted to social media sites at all.

Hiring for Project Management Skills Grows to New Highs

Wanted Analytics (06/06/12) Abby Lombardi

During May 2012, more than 238,000 online job listings included requirements for project management skills, an 11% increase compared with May 2011 and more than 51% compared with May 2010. As companies increasingly migrate to new technologies, information technology-related jobs most commonly require project management experience and represent 41% of all jobs that include this specification. The five metropolitan areas with the highest volume of online job ads requiring project management skills were New York, Washington, Chicago, Los Angeles, and San Francisco.