Hiring boom? Hardly. But the worst seems over.

By Robert Gavin
Globe Staff / January 10, 2010

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For Massachusetts job seekers, 2010 won’t be the happiest year. But it’s almost certain to be happier than 2009.

The state’s job market is poised for a modest rebound as the economic recovery takes hold and employers accelerate hiring, analysts said. No one is expecting a boom, and unemployment should remain high into 2011. But after two years of steadily shrinking payrolls, even slow job growth will be something to cheer, analysts said.

“The outlook is certainly more positive,’’ said Elliot Winer, an independent economist in Sudbury. “We’re not going to see a rapid improvement, but we should see some steady gains.’’

Signs that the job market is heading for a turnaround have increased in recent months. In Massachusetts, the unemployment rate fell for two consecutive months, plunging to 8.8 percent from 9.3 percent in September. Job losses have diminished, too. In October and November, statewide job losses averaged about 1,300 a month, compared with more than 15,000 a month in the same period a year earlier, according to state Executive Office of Labor and Workforce Development. The state will report December employment statistics in about two weeks.

Meanwhile, key sectors of the state’s economy have been adding jobs. Health care chugged through the recession, gaining more than 10,000 jobs over the past year. Hiring in higher education, which slowed when plunging financial markets battered endowments, has picked up again. The sector added 2,000 jobs over the past six months, compared with 1,200 in the previous six months.

Professional and business services, which include law, accounting, and consulting firms, have made a decided turnaround, gaining nearly 8,000 jobs in the past six months, after losing 23,000 in the previous six months, according to state figures. The sector’s technology component - professional, scientific, and technical services - has increased employment in four of the past five months, adding 1,100 jobs in November.

Mark Goodstein, president of Techpros of Newton, a recruiting firm specializing in the software industry, said hiring among his clients began to pick up in August, and his job placements have increased more than 50 percent since then.

“There’s been a shift in focus to hiring and expanding teams,’’ said Goodstein. “It’s not an explosion, but definitely a pickup.’’

The competition for jobs, however, remains fierce. More than 300,000 Massachusetts residents are unemployed and tens of thousands more working part-time jobs because they can’t get full-time work. Several sectors continue to struggle.

Retailers, for example, have cut jobs in each of the past three months, and shed nearly 14,000 over the past year, according to state statistics.

Financial service firms, dealing with the fallout from the financial crisis and housing bust, have shed nearly 6,000 jobs in the past six months, and more than 9,000 in the past year.

Two of the hardest-hit sectors - manufacturing and construction - may have bottomed out, but they face long, difficult recoveries, analysts said. Construction added 500 jobs over the past two months, but has still lost more than 27,000 - or one in five - since the recession began here in March 2008. Manufacturing gained 900 jobs in November, a fraction of 23,000 jobs lost in the recession.

Nationally, the labor market suffered a setback in December as US employers cut 85,000 jobs and the unemployment rate held at 10 percent, the Labor Department reported Friday.

But overall trends suggest the US labor market is near bottom, economists said. For example, job losses in the last three months of 2009 averaged less than 70,000 a month, compared with nearly 200,000 a month in the previous three-month period.

“The job trend decline has fallen sharply,’’ said Nigel Gault, chief US economist at IHS Global Insight in Lexington. “It is probable we will see actual job gains, on average, during the first quarter’’ of this year.

For many job seekers, the key to employment will be developing new skills and upgrading old ones, said Michael Goodman, an economic analyst and professor of public policy at the University of Massachusetts Dartmouth. Industries with the best growth prospects, such as health care and technology, increasingly require higher levels of education and training.

“It’s a good time to revisit and update skills,’’ Goodman said. “People with higher education and skills will be more marketable.’’

Michael Taylor, director of the state Department of Workforce Development, said job seekers should focus on how to transfer skills to different industries. For example, he said, hospitals need financial analysts as well as doctors and nurses, so workers laid off from financial firms might find opportunities in health care.

“A lot of jobs people had aren’t coming back, and they need to redirect their skills,’’ Taylor said. “It’s not about what jobs you’ve had, but what skills you’ve developed.’’

Robert Gavin can be reached at