Global Job Market Set To Weaken In Coming Months

LONDON (Dow Jones)--The global job market is set to weaken in the coming months, with employers in Spain, Ireland and Italy planning to lay off workers, a survey by employment services group Manpower Inc. (MAN) showed Tuesday.

Employers in 25 of a total of 33 surveyed countries said they will slow their pace of hiring in the fourth quarter of 2008 compared to this quarter, according to the report, which collates interview data from 55,000 employers.

"The recent downturn is weighing on the minds of employers. They are not conducting widespread layoffs across all industry sectors, which is encouraging; yet, we are not seeing much appetite to add staff either," said Jeffrey A. Joerres, Manpower Chairman and CEO.

"In the coming months we will continue to see employers around the globe making do with the people they have, finding ways to contain costs and being very cautious about hiring decisions."

Countries in Europe are set to fair the worst in the fourth quarter, as U.K. employers reported their least optimistic hiring outlook since the second quarter of 1992. A seasonally adjusted balance of no employers in the U.K. said they planned to add workers over the fourth quarter.

"Now there's a real sense that the fourth quarter in the U.K. will be more difficult," Joerres said. In previous quarters the slowdown seemed to be contained to sectors directly affected by the credit crunch, such as construction and finance, but that other sectors were now facing softer projections, he said.

In Spain, Ireland and Italy, employers said they planned to reduce headcounts, with the Spanish index sinking to a fresh, five-year low.

Over the quarter a seasonally adjusted balance of -5 employers said they planned to reduce headcounts; in the third quarter it was -3.

Italy and Ireland reported negative outlooks for the first time, with the seasonally adjusted Italian balance declining to -2 in the fourth quarter from 1 in the third quarter.

Joerres said the high number of small- and medium-sized manufacturing companies in Italy had been hit by the deteriorating global economic environment and that this had resulted in job cuts.

"Italy has been looking at negative numbers for some time, such as manufacturing output," he said. "In the next several quarters this could be the same."

The survey also showed that the U.S. labor market is set to lose more momentum with employers planning to hire at the slowest pace in five years. The seasonally adjusted balance of 9% of firms said they planned to add workers in the fourth quarter , down from 12% in the third quarter.

"The U.S. has been flirting on the edge of a much more dramatically contracting environment...especially with the backdrop of the labor market," Joerres said.

Data released Friday showed the U.S. jobless rate unexpectedly jumped to 6.1% in August - nearly a five-year high - as employment fell for an eighth-straight month.

U.S. nonfarm payrolls fell by 84,000 in August, with declines in manufacturing, construction and service industries. The U.S. Labor Department also revised June and July to show bigger declines.

The employment outlooks remained relatively stable in France and Germany, Manpower said.

Companies in India, Costa Rica, Peru and Singapore reported the most favorable fourth-quarter hiring plans.

-By Emma Charlton, Dow Jones Newswires; +44-20-7842-9307; emma.charlton@dowjones.com

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