Global Talent Update - May 2017

GlobeEurope, Middle East and Africa

France had stand-out employment gains in the first quarter, as the U.K. sees its lowest jobless rate in nearly a half-century, and technology continues to develop industry in the UAE.

The unemployment rate in the Eurozone fell to 9.5 per cent in March, its lowest level in eight years and 0.7 per centage points lower than it was in March 2017, Euronews reported.

France had a strong first quarter for employment, with the size of the labour force expanding to 16.2 million, the largest figure since the financial crisis struck in mid-2008, the Financial Times noted. Wages also increased, rising by 0.6 per cent during the quarter.

The unemployment rate, however, rose to 10 per cent, up from 9.7 per cent in the final quarter of 2016.

The strong first-quarter figures come as France welcomes its new president, Emmanuel Macron, following the May 7 election. Macron's party, Republic on the Move, is anticipated to win parliamentary majority, Reuters reported. The first round of the National Assembly election is June 11.

The unemployment rate in the U.K. dropped to a 42-year low in the first three months to March, registering at 4.6 per cent, the BBC reported. Average weekly earnings excluding bonuses rose by 2.1 per cent, though wages decreased by 0.2 per cent.

Economic issues will likely be front and center on June 19, the day that formal talks begin for Britain's exit from the European Union, The Guardian detailed. The negotiations will take place over 15 months, during which EU Chief Negotiator Michel Barnier and the yet-to-be-named British Brexit secretary and their respective teams will meet to discuss the terms of the Brexit process.

Innovation as an economic driver has been front-and-center in the United Arab Emirates, where several industries may be shaken up by technological advances, such as banking. The CEO of major bank Mashreq, Abdul Aziz Al Ghurair, stated that his company plans to become a "branchless bank" by embracing online services, a move that would lead to major job cuts, Gulf News reported.

However, cybersecurity is an area that may provide an employment boost. The Dubai Electronic Security Center recently announced that it intends to increase its Emirati-only workforce by 50 per cent this year, Arabian Business reported.

Asia-Pacific

Joblessness remains low in Japan while Thailand sees measured economic growth.

Japan's unemployment rate is currently 2.8 per cent, its lowest level in 26 years, reported Xinhuanet, citing data from a government report.

Wage conditions are also favorable. Morgan Stanley predicted that wage growth will reach 2.8 per cent by the end of 2018, according to Bloomberg. Overall compensation increased by 2.2 per cent growth last year.

In partnership with Broadcast Satellite Japan, CNBC recently interviewed Japanese Prime Minister Shinzo Abe.

"I believe we are finally close to realizing the situation that if you want to recruit good human resources, you really have to improve the wage conditions or fail to hire anyone suitable," he said.

Abe also commented that Japan will pursue "sectoral cooperation" to implement energy, infrastructure and high-speed rail projects that will create jobs.

Japanese companies will also have to consider how to accommodate a growing gig economy, The Japan Times noted. Freelancers currently make up 17 per cent of the country's working population. As of February, there were 11.22 million freelancers between the ages of 20 and 69 in the country, representing an increase of 5 per cent since last year.

The Thai economy grew at its fastest pace in four years during the first three months of 2017, Seeking Alpha reported. However, analysts are concerned that growth may be more reserved the rest of this year. The Nikkei-Markit Purchasing Managers' Index™ declined by 0.4 points in April, registering at 49.8, which is the first time it has decreased in four months. Furthermore, IHS Markit set its 2017 GDP forecast for the country at 3.1 per cent, down from its 2016 forecast of 3.2 per cent.

However, growth in several industries may help boost employment and economic conditions in Thailand. A budding life sciences industry is helping retain top talent in the country, according to Clinical Leader. The government created the Talent Mobility Program, an initiative designed to increase opportunities for government and university researchers to work in the private sector.

Tourism is also a growing industry, contributing nearly 20 per cent of national GDP and employing almost 6 million people, which represents more than 15 per cent of total employment in Thailand.

Americas

The U.S. had strong job gains in April and Latin America received a favorable economic outlook from the International Monetary Fund.

Employment gains exceeded economists' expectations in April as the country added 211,000 jobs during the month, according to data from the Bureau of Labor Statistics. The gains followed a weak March, which saw just shy of 80,000 positions added.

The April job growth caused the national unemployment rate to fall to 4.4 per cent, its lowest level since May 2007, Bloomberg reported.
"Labor market conditions remain robust and continue to tighten," said Ward McCarthy, Jefferies LLC chief financial economist, according to the source.

The Federal Reserve did not move to raise interest rates at its meeting in May, however, some major banks such as UBS are anticipating hikes in June and September, CNBC reported.

For the rest of 2017, job growth will likely be the strongest in southern states, according to a report from the U.S. Conference of Mayors, New American City and the Council on Metro Economies, Next City reported. The report asserted that migration from the North will boost employment in Sun Belt States. The groups specifically believe the Orlando, Dallas and Denver metro areas will have the strongest job growth this year.

Latin America

Market gains are hoped to improve the employment situation in Latin America. The International Monetary Fund predicted in a recent report that economic growth in the region would increase by 1.1 per cent this year, following declines in 2016.

Argentina in particular is expected to experience strong growth, with the IMF anticipating that its economic activity would expand by 2.25 per cent in 2017, supported by strong consumer and public capital spending.

While the job market has been stagnant in Argentina, with the number of those working or actively looking for a job dropping by 150,000 in the fourth quarter to register at 12.4 million, investors have been encouraged by a declining fiscal deficit, Reuters explained.

 

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