Now that we’re well into the second quarter of 2015, the outlook for the global economy is becoming increasingly clear. Though a number of countries such as the UK and India demonstrate strong economic growth, softer first quarter performance in countries such as the United States and China, as well as recessions in large South American economies and Russia, will temper overall growth. These economic conditions are impacting labor markets differently worldwide.
After a slow start, the economic outlook for North American countries is generally healthy for the upcoming year. In the U.S., the slow first quarter is expected to be followed by an increased hiring pace during the rest of the year, though it may remain lower than 2014’s considerable job gains. How much lower will depend on whether the summer months will bring more robust economic and labor market growth. Canada will see some job creation and more or less static unemployment; however, experts are concerned about the increase in part-time positions at the expense of full-time employment. And though Mexico’s unemployment rate dropped sharply in March, increased participation in the labor force may limit further decline.
This is in stark contrast to the recessionary conditions expected in Argentina, Venezuela, and Brazil, where consumer and business sentiment are at unprecedented lows. In fact, with continuing layoffs by manufacturers, construction firms, and retailers, the Brazilian unemployment rate is predicted to increase to 5.5 percent in 2015.
With varying economic conditions across the region, labor markets are seeing accordingly diverse developments. While the United Kingdom and Germany are experiencing job growth, France’s labor market is less robust, with high unemployment and limited job creation. At the same time, Russia—already in a full-blown economic recession, with the GDP projected to contract by five percent this year—is seeing rising unemployment rates. However, the expectation is that many companies will initially opt for wage reductions over job cuts.
This year, China’s GDP growth is expected to slow to 6.5 percent. And while the unemployment rate has stayed level so far, the government is planning stimulus policies to aid urban employment. In Australia, the jobless rate fell to 6.1 percent last quarter; however, with volatile conditions, this might not be a sustainable development. On a more positive note, Japan’s improved exports and growing consumer confidence indicate a rebound of the island state’s economy, a trend that’s reflected in healthy hiring rates. And in India, there’s a continued demand for higher-level technology talent, resulting in an enhanced importance of targeted recruitment and retention strategies.
It’s clear that there are significant differences between the Americas, EMEA, and APAC, and at the same time, significant intraregional disparities. The question now is whether first quarter labor trends will continue or adjust throughout the remainder of the year.
Read more about latest employment trends in our new Talent Market Quarterly report here.