At first glance, the most recent (Q3 2008) Manpower Employment Outlook Survey suggests that hiring plans for third-quarter 2008 are “steady.”

Indeed, the seasonally adjusted value of net hiring plans in the third quarter (11%) was up slightly from its value (10%) in second-quarter 2008. However, a closer look at the report reveals that net hiring plans in third-quarter 2008 are 36 percentage points lower than they were in third-quarter 2007.

In fact, third-quarter hiring plans have not be this low since 1998.

Across the 10 industrial categories surveyed by Manpower, the largest net drop in hiring plans occurred in the construction industry, where the net percentage of firms planning to add staff dropped by 22 percentage points, from 31% to 9%. The softness in hiring plans was not confined to construction, however. Other industries that saw declines in third-quarter hiring plans included: education services (-15); non-durables manufacturing (-11); wholesale and retail trade (-10); public administration (-8); financial services (-6); mining (-6) and miscellaneous services (-1).

Surprisingly, in spite of higher oil price, the transportation sector was the only one that saw hiring plans increase in the third quarter.

Regionally, total net hiring plans retreated in all four major regions surveyed by Manpower in the third quarter. The four western provinces saw the most pronounced drop, -30.6 percentage points year over year. Ontario (-26.1), Atlantic Canada (-18.2) and Quebec (-4.3) also saw reductions in total net hiring plans.

With respect to net hiring plans in construction in particular, the largest year-over-year declines occurred in Atlantic Canada (-63.8), followed by Western Canada (-52.2), Québec (-38.0) and Ontario (-28.3).

Looking forward, given the sharp drop in net construction hiring plans in all major regions surveyed by Manpower, and assuming that changes in net hiring plans continue to lead employment growth in the industry by one to two quarters, it appears likely that employment growth in the industry will slow significantly in the second half of this year in all major regions.

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