Is it time to dust off your CV for the job market revival?

The Return to Growth

We hear talk that the UK economy is recovering.   We continue to see the FTSE shoot past 5000 (see chart 1 below), as traders pile into the bull market in search of the easy profits so greatly missed since August 2007.  Certainly bankers are set to receive bumper bonuses, higher than any previous year as far as Goldman Sachs is concerned, showing that confidence is returning to the City. Yet again, the City is proving that almost anyone can make a big profit when indexes only go up and go up steeply like this.  But the market is just a sea of expectations and assumptions – and so markets can come crashing back down to earth when “main street” realities prick the bubble of Wall Street financial models.

Bank super profits are easy when indexes rise so fast

FTSE 100 Index: Bank super profits are easy when indexes rise so fast

But this happy picture of improvement is not restricted to the investment banks. Surprise data from the UK Office of National Statistics shows a drop in youth unemployment over the last quarter: young jobless numbers fell from the record high of 947,000 to 946,000, rather than breach 1 million as forecast by economists.  Google, considered the weather vane of the internet economy, has seen rising quarterly profits ahead of analysts’ expectations (14/10/2009). And John Lewis, the same barometer on the high street, has also seen rising sales.

On the other hand, Economists urge caution that we are not out of the woods yet. Certainly as far as employment is concerned we are in a precarious position.  The chart below shows the trend in jobless totals in past recessions in the USA, and it seems we are not far from the bottom when looking 24 months out from Dec 2007. But this recession is different to others.

The chart shows the progress of job losses in the USA in past recessions

The chart shows the progress of job losses in the USA in past recessions

The shock to bank balance sheets has been extreme and many European banks are still sitting quietly on toxic assets that they have yet to write down, holding them for the long term in the hope they will recover their value. While these assets exist, banks will need to restrict their lending and build up their capital base such that lending to businesses – the engine of our future recovery – is constrained.  Banks also continue to deal with rising corporate and residential defaults that reinforce their risk averse proclivities.  As repossessions continue, mortgage payment protections run out and central government prepares to end its support in the face of huge deficits, more painful job losses and cancellations of large projects will ripple through the economy.

So, do you brush off your CV? Well, yes of course. One must not stand still. But don’t think that the market is easy or think something is wrong with you if you cant find work quickly. We have more ups and downs in this recession and you need to be savvy, positive, creative and realistic. The opportunities are there – but you need to find them and be well-prepared to get them.

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2 Responses to Is it time to dust off your CV for the job market revival?

  1. Stacey Derbinshire says:

    I found your site on technorati and read a few of your other posts. Keep up the good work. I just added your RSS feed to my Google News Reader. Looking forward to reading more from you down the road!

    • PlatinumMD says:

      Thanks Stacey. Your site also contains some great articles. I will be bookmarking your pages, too. Thanks!