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3 Staffing Stocks in Focus as Job Market Remains Resilient
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One of the major challenges for the Federal Reserve in tackling inflation has been the resilient job market. Inflation hit a 40-year high in 2022 and the Federal Reserve adopted a strict monetary tightening policy by hiking rates by 525 basis points for the past 21 months.
This saw a sharp decline in inflation, which now appears to be nearing the Federal Reserve’s 2% target. However, the job market continues to be on solid ground even after that. Although the labor market softened slightly last year, job additions have been on the rise again.
The Department of Labor reported on Feb 2 that the U.S. economy added 353,000 nonfarm jobs in January, almost double the consensus estimate of 185,000.
Also, job additions were upwardly revised by 126,000 for November and December 2023. December job gains totaled 333,000, while November’s numbers came in at 182,000.
Job additions in January were seen across sectors, with professional and business services leading with 74,000 new employments. Healthcare added 70,000 new heads, while retail trade, government, social assistance and manufacturing added 23,000, 36,000, 30,000 and 45,000 new jobs, respectively.
While it is difficult to assess the job market at the beginning of the year given that a large number of jobs are created during this time because of the holiday season and are temporary, the overall numbers hint at a resilient labor market.
Also, the unemployment rate held steady at 3.7% in January against expectations of 3.8%.
The average workweek came in at 34.1 in January, down from 34.3 in December. The hourly wage rate saw a 0.6% increase in January, surpassing the December rate of 0.4% and economists’ expectations of 0.3%.
On a year-over-year basis, the hourly wage rate jumped 4.5%, surpassing the consensus estimate of 4.1%.
Moreover, the labor market is poised to remain resilient in the first half of 2024 as the Conference Board’s Employment Trends Index raced to a reading of 113.15 in December from November’s downwardly revised reading of 112.48.
Stocks to Watch
Given the steady job additions to the economy and promising outlook, it would be ideal to invest in staffing firms like KornFerry International (KFY - Free Report) , Heidrick & Struggles International, Inc. (HSII - Free Report) and TrueBlue, Inc. (TBI - Free Report) .
These stocks have seen positive earnings estimate revisions in the last 60 days. Each of our picks carries a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.
KornFerry International is the world's leading and largest executive recruitment firm with the broadest global presence in the executive recruitment industry. KFY provides executive recruitment services exclusively on a retained basis and serves the global recruitment needs of our clients from middle to executive management. KornFerry International’s clients are many of the world's largest and most prestigious public and private companies, middle-market and emerging growth companies as well as governmental and not-for-profit organizations.
KornFerry International’s expected earnings growth rate for next year is 8.9%. The Zacks Consensus Estimate for current-year earnings has improved 2.9% over the past 60 days. KFY has a Zacks Rank #2.
Heidrick & Struggles International, Inc. serves the executive talent and leadership needs of the world's top organizations as the premier provider of leadership consulting, culture shaping and senior-level executive search services. HSII is one of the leading global executive search firms.
Heidrick & Struggles International’s expected earnings growth rate for next year is 5.2%. Shares of HSII have gained 20.9% in the past three months. Heidrick & Struggles has a Zacks Rank #3.
TrueBlue, Inc. is a leading provider of specialized workforce solutions, helping clients improve growth and performance by providing staffing, workforce management, and recruitment process outsourcing solutions. TBI’s specialized workforce solutions meet clients' needs for a reliable, efficient workforce in a wide variety of industries.
TrueBlue’s expected earnings growth rate for next year is 325%. Shares of TBI have gained 13.1% in the past three months. TrueBlue presently carries a Zacks Rank #3.
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3 Staffing Stocks in Focus as Job Market Remains Resilient
One of the major challenges for the Federal Reserve in tackling inflation has been the resilient job market. Inflation hit a 40-year high in 2022 and the Federal Reserve adopted a strict monetary tightening policy by hiking rates by 525 basis points for the past 21 months.
This saw a sharp decline in inflation, which now appears to be nearing the Federal Reserve’s 2% target. However, the job market continues to be on solid ground even after that. Although the labor market softened slightly last year, job additions have been on the rise again.
The Department of Labor reported on Feb 2 that the U.S. economy added 353,000 nonfarm jobs in January, almost double the consensus estimate of 185,000.
Also, job additions were upwardly revised by 126,000 for November and December 2023. December job gains totaled 333,000, while November’s numbers came in at 182,000.
Job additions in January were seen across sectors, with professional and business services leading with 74,000 new employments. Healthcare added 70,000 new heads, while retail trade, government, social assistance and manufacturing added 23,000, 36,000, 30,000 and 45,000 new jobs, respectively.
While it is difficult to assess the job market at the beginning of the year given that a large number of jobs are created during this time because of the holiday season and are temporary, the overall numbers hint at a resilient labor market.
Also, the unemployment rate held steady at 3.7% in January against expectations of 3.8%.
The average workweek came in at 34.1 in January, down from 34.3 in December. The hourly wage rate saw a 0.6% increase in January, surpassing the December rate of 0.4% and economists’ expectations of 0.3%.
On a year-over-year basis, the hourly wage rate jumped 4.5%, surpassing the consensus estimate of 4.1%.
Moreover, the labor market is poised to remain resilient in the first half of 2024 as the Conference Board’s Employment Trends Index raced to a reading of 113.15 in December from November’s downwardly revised reading of 112.48.
Stocks to Watch
Given the steady job additions to the economy and promising outlook, it would be ideal to invest in staffing firms like KornFerry International (KFY - Free Report) , Heidrick & Struggles International, Inc. (HSII - Free Report) and TrueBlue, Inc. (TBI - Free Report) .
These stocks have seen positive earnings estimate revisions in the last 60 days. Each of our picks carries a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.
KornFerry International is the world's leading and largest executive recruitment firm with the broadest global presence in the executive recruitment industry. KFY provides executive recruitment services exclusively on a retained basis and serves the global recruitment needs of our clients from middle to executive management. KornFerry International’s clients are many of the world's largest and most prestigious public and private companies, middle-market and emerging growth companies as well as governmental and not-for-profit organizations.
KornFerry International’s expected earnings growth rate for next year is 8.9%. The Zacks Consensus Estimate for current-year earnings has improved 2.9% over the past 60 days. KFY has a Zacks Rank #2.
Heidrick & Struggles International, Inc. serves the executive talent and leadership needs of the world's top organizations as the premier provider of leadership consulting, culture shaping and senior-level executive search services. HSII is one of the leading global executive search firms.
Heidrick & Struggles International’s expected earnings growth rate for next year is 5.2%. Shares of HSII have gained 20.9% in the past three months. Heidrick & Struggles has a Zacks Rank #3.
TrueBlue, Inc. is a leading provider of specialized workforce solutions, helping clients improve growth and performance by providing staffing, workforce management, and recruitment process outsourcing solutions. TBI’s specialized workforce solutions meet clients' needs for a reliable, efficient workforce in a wide variety of industries.
TrueBlue’s expected earnings growth rate for next year is 325%. Shares of TBI have gained 13.1% in the past three months. TrueBlue presently carries a Zacks Rank #3.