Industry News

Businesses grow cautious as labor costs rise

Hiring may cut too deeply into profits during holidays

A key indicator that measures job offerings in major U.S. newspapers edged up in October, but businesses aren't likely to start hiring in droves any time soon, The Conference Board reported today. "The job market is responding to a cooling in the overall economic environment. This holiday season, deep discounts are being offered for many products, but this will cut into profit margins as labor cost increases edge up," said Ken Goldstein, labor economist at The Conference Board. "That makes business attitudes no more bullish than consumer attitudes. Business plans have become cautious -- on spending, on building inventory, and on hiring going forward." The Help-Wanted Advertising Index registered 30 last month, up from 29 in September, but still much lower than the 37 reading recorded in October 2005. In the last three months, help-wanted advertising declined in eight of the nine U.S. regions. Steepest declines occurred in the East North Central (-15.4 percent), South Atlantic (-13...

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