Economy: U.S. employment picks up, but wages stalled; overseas weakness persisted
If the U.S. economy were a patient, it would at long last be out of intensive care. But it would surely be haunted by nightmares about the rounds of job cuts endured after the Great Recession began in December 2007. While the economy continues its slow convalescence in the U.S., it’s still shaky in other major chemical manufacturing regions, including Europe and Japan.
Chemistry employment is picking up in the U.S., though salaries remain flat. Yet there are major disparities between new chemistry graduates—who aren’t yet benefiting from the turnaround—and the overall ACS membership. ACS surveys indicate that 2.9% of U.S. member chemists were unemployed and seeking a job as of this March, down from 3.5% in 2013 and a peak of 4.6% in 2011. But the most recent data from ACS surveys of chemistry graduates revealed a shocking 14.9% were unemployed and job hunting as of October 2013, up from 12.6% a year earlier.
Despite the strengthening U.S. economy, job cuts continue in the chemical and pharmaceutical sectors. GlaxoSmithKline announced a global restructuring program in October and is significantly shrinking activities in Research Triangle Park, N.C., as it shifts most of its R&D operations to sites in Stevenage, England, and Philadelphia. Earlier this month, Huntsman said it plans to cut 900 jobs from its recently enlarged pigments and additives division as part of its own restructuring effort.
In this context, it’s not surprising that salaries for chemists aren’t rising. In fact, if inflation is taken into account, their purchasing power is actually dropping.
Outside the U.S., the situation is worse in many regions. Last month, Japan’s Ministry of Economy, Trade & Industry urged further downsizing of the nation’s chemical industry. The ministry noted that the emergence of shale gas as a low-cost feedstock in North America and China’s development of coal as a feedstock have made it difficult for Japan’s petrochemical industry to compete globally.
The competitiveness of Europe’s chemical industry has also been hurt by the shale gas boom. And Europe’s economy and chemical industry employment have been slower to improve than in the U.S.
Meanwhile, China, whose strong economic growth has for several years mitigated the impact of the global recession, is itself now seeing a slowdown because of a softening housing sector and weaker domestic and export demand.