By Eve Tahmincioglu contributor
updated 1/5/2009 10:06:32 AM ET 2009-01-05T15:06:32

I’ve decided to ask the Magic 8-Ball about the jobs outlook for this year.

I came to this conclusion after spending days talking to economists, academics and a host of career experts about the employment picture in 2009.

I got a lot of very different opinions — everything from “doom and gloom” to “encouraging,” depending on whom I asked. The prognostications also vary depending on the geographic area and industries involved. And many experts are brushing aside dire predictions in hopes the incoming Obama administration will create infrastructure and “green” jobs.

What will it all mean?

“We’re getting mixed signals,” says Rick Hearin, director of career services for Miami University in Ohio, who admits he can’t exactly figure out what this year has in store for job seekers.

The bottom line is that most experts are expecting a tough road for the both the unemployed and the employed — who face pay cuts and scaled back benefits — in the new year. Hearin is no exception. Based on what he’s seeing with employers in his area, he’s expecting one of the most competitive job markets in decades, for everyone from college grads to mid-career folks.

Tight labor market
Indeed, many economists expect an extremely tight labor market this year as the economy sheds more and more jobs.

“Another 2.5 million jobs will be lost in 2009,” says John Stapleford, an economist with That is on top of 1.9 million jobs lost in the first 11 months of 2008. (Preliminary figures for the full year will be published Friday.)

Stapleford he projects the jobless rate to peak at 8.7 percent by the end of the year, up from 6.7 percent currently, while some experts predict the rate could rise to 9 percent or more.

Things generally look worse for workers without four-year college degrees.

Based on the latest government data, the jobless rate among workers with only high school degrees was 6.7 percent, compared with 3 percent for those who finished college.

And unlike past recessions, when there were certain parts of the country that did better than others, this downturn is hitting almost every corner of the nation, with almost every region in recession or at risk of falling into a recession, Stapleford says.

But there are tiny pockets of hope in a handful of towns and a handful of sectors.

Only 13 out of 381 metropolitan areas are actually growing, he says. According to they are Boulder, Colo.; Lafayette and Louisiana, La.; Bethesda, Md.; Jacksonville, N.C.; Binghamton, N.Y.; Oklahoma City; Okla.; State College, Pa.; and Brownsville, El Paso, Laredo, McAllen, and San Antonio, Texas.

The growth industries of health care, government and education show no signs of slowing so far, he adds. But even among government and education employment, Stapleford expects tightening this year.

Among large employers, layoff plans have risen significantly, according to consulting firm Watson Wyatt.

It’s a mixed bag for hiring among small and midsized companies, considered the engine that drives the nation’s employment.

One study by the National Federation of Independent Business found over the next three months, only 6 percent plan to create new jobs and 17 percent plan work force reductions, the lowest readings since the recession in the early 1980s.

But another survey of small firms called the Entrex Private Company Index found that 72 percent of CEOs are bucking the downsizing trend and plan to increase the number of employees they hire this year.

“Even better, all other respondents indicated they would maintain the current number of full-time employees — meaning zero CEOs suggest plans to decrease employment size in 2009,” the study found.

Many people have their hopes pinned on a new economic stimulus plan that will be spearheaded by the incoming Obama administration and is likely to focus on investments in infrastructure and green technology.

“I think the new president is going to come out swinging,” says Rob McGovern, CEO of job-search Web site Jobfox. “That’s ultimately going to result in tremendous job creation.”

But many economists believe those plans will be slow to come to fruition.

“If the federal government carries out some of the infrastructure projects by channeling money to the states for projects that are already on the drawing board, it could happen in 2009,” says Mike Knetter, dean of the Wisconsin School of Business. “If we are launching new projects and need to follow the processes typical of a government procurement contract, then it will be 2010 at best.”

But even if the economy turns around midyear, “the employment market tends to lag behind,” says Knetter, who was a senior White House economist under former presidents George H.W. Bush and Bill Clinton.

Firms will use the period of turnaround to revamp their organizational structures and boost productivity, he adds.

Feeling the pinch
Knetter is expecting a continuing soft market for finance jobs, not just in the U.S. but globally. Bright spots include the insurance sector, he says, because people always need insurance and legal service professionals, especially during periods of financial distress.

Another area that’s still showing growth is health information technology, particularly medical records management, says Adonis Phillips, regional director of career services for DeVry University in southern California.

But jobs like IT help desk positions and anything in real estate or the mortgage sector are feeling the pinch, he adds.

In most industries, employers are being cautious when it comes to hiring, says Francyenne Maynard, director of the department of career services for Dallas-based North Lake College.

“It’s not grim, but it’s definitely more challenging,” she says. Even government jobs, she adds, including city and state positions, are becoming much more competitive.

Best bets right now and throughout the year, she notes, include nursing, physician and medical assistants and pharmacy positions.

Employment seekers should not just jump at the hottest jobs, Maynard says. Many individuals are not cut out to work in the health care field, for example, which could include interacting with people who are sick and a willingness to work odd hours.

And, she adds, “What’s hot now may not be hot after you spend a year or two in school.”

People need to realize the economy is cyclical, she says. They also have to find something they’ll enjoy doing and then find ways to build up their skills.

As for asking the Magic 8-Ball about the employment outlook, the best answer right now seems to be: “Outlook not so good.”

Eve Tahmincioglu writes the weekly "Your Career" column for and chronicles workplace issues in her blog,


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