Rising productivity and profits mean companies not keen on jobs hiring

Rising productivity and profits mean companies not keen on jobs hiring

Jobs hiring may not necessarily follow an increase in productivity and profits in this down economy, recent data suggests. Companies are utilizing ways to maximize existing resources that they have including their workers to eke out a profit and they are not are so keen to expand their business because of the lingering uncertainty. With productivity rising, jobs that were cut because of the downturn may not come back anytime soon.

Even as the Bureau of Labor Statistics reported in November 18 that fewer Americans are being laid-off, jobs hiring have not picked up either. New jobs from companies were just 6.1 million for the first quarter, the lowest three-month gain since the recession ended. There were 6.4 million jobs lost from failed businesses, the smallest decline since 1992, according to the BLS.

The Federal Reserve recently announced another round of bonds purchase worth $600 billion to try to boost the economy and bring down the unemployment rate which has persistently hovered at 9 percent during the recession. October’s jobless rate held steady at 9.6 percent signifying the reluctance of businesses to hire more workers. The U.S. economy grew at a 2.5 percent annual rate during the third quarter which is just enough to keep currently-employed people from losing their jobs.

Large companies like Campbell Soup Co., United Parcel Service Inc., and DuPont Co., are trying to work with its remaining workers to boost efficiency, save productions costs, and improve profit margins instead of focusing on jobs hiring at least on the short-term.

Posted by James Fried on Sunday November 28 2010, 4:21 AM EST. Ref: Bloomberg. All trademarks acknowledged. Filed under Featured News, Finance. Comments and Trackbacks closed. Follow responses: RSS 2.0