Unemployment rises. Any good news for job seekers?

Despite high unemployment, temp work is on the rise and employers still want to hire.

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    In this Nov. 30 photo, a job applicant walks through the front door of a career fair in San Diego. The nation's unemployment rate climbed to 9.8 percent in November, a seven-month high, as hiring slowed to a near crawl. One bright spot: temporary jobs.
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Friday's dismal employment report cast a shadow of doubt on the growing optimism that the United States economy was beginning to accelerate.

The unemployment rate? Back up to 9.8 percent. The number of jobs created? Only 39,000, a total far below expectations. Even Labor Secretary Hilda Solis conceded it was too small to keep up with natural growth in the labor market, let alone reemploy "the millions of Americans who continue to wake up every morning and look for work."

So was there anything positive on the job front for those unemployed Americans?

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"It's important not to read too much into one month report," says Scot Melland, CEO of Dice Holdings, which runs specialized career websites in the technology, financial services, and healthcare industries. "It continues this sort of slow recovery that we've been seeing since the beginning of the year."

For example, while government hiring is down, the private sector is on average picking up. In the first half of 2010, private employers hired a net 98,000 people a month on average, he points out. From July through November, their average monthly hiring has notched up to 116,000.

Even the gloomy November report had a few bright spots, including professional and business services. That sector was up 53,000 jobs. While better than two-thirds of those new positions were temp jobs, temporary services are typically good indicators of future full-time hiring.

Then there's the possibility that the November employment figures are skewed, because the figures showed job declines in sectors that have seen strong sales growth, such as retail: retail employment fell by 28,000, even though retail sales grew strongly.

"We're reluctant to take this report at face value, and suspect that it is an outlier – on the down side," wrote Nigel Gault, chief US economist for IHS Global Insight, in an analysis Friday.

Employers are still looking to hire.

Back in May, Dice Holdings interviewed more than 1,000 companies, and found that just over half planned to hire more workers in the second half of the year. But many said hiring was taking longer than usual.

The No. 1 reason? Caution about the economy, Mr. Melland says.

In its latest survey, wrapped up just last month, half of employers again expected to hire more workers in the first half of 2011.

The No. 1 reason it's taking a while, this time? The inability to find qualified candidates – a sign that employers' outlook has turned more positive.

"Things are getting better," Melland says. "It's just taking longer."

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