Seasonality & hiring: accounting, law, finance, and healthcare
Read part 2 of our report on accounting, law, finance, and healthcare industries.
Read part 3 of our report on the technology industry.
While small business hiring in some industries proceeds at a steady clip throughout the year, others have pronounced seasonality, according to new data from Guideline. In Finance and Insurance, the number of jobs increases the most in May of each year, whereas in Accounting, Tax, and Payroll, the hottest month is December. In contrast, job growth in Health and Social Services does not see a pronounced pattern of seasonality.
We looked at employment numbers at companies offering an easy-to-use Guideline 401(k) across a range of industries from 2015 to the present, to find out what patterns emerge throughout the year. In this post, we’ll take a look at what seasonality means and dive into the accounting, law, finance, and healthcare industries. In future posts, we’ll examine in greater detail other industries, including technology, retail, and leisure.
First, what is seasonality in employment and why does it matter?
For a whole host of reasons ranging from school schedules to fluctuating consumer demand due to holidays, and even tax deadlines, the number of people employed in different industries and regions may vary in a regular way throughout the year. For example, since much of its work depends on the weather, construction is the most seasonal industry in the United States, with an employment swing of over 20% industry-wide, according to data from the Federal Reserve Bank of Chicago. This same dataset shows that manufacturing, which is more likely to center around work in factory-controlled conditions, has very little seasonal variation in employment.
A quick note as we turn to Guideline’s data: whereas the above data from the Chicago Reserve looks at the total number of jobs in any given month as a percent higher or lower than the annual average, our Guideline data shows the average rate of month-over-month job growth. In other words, peaks in the below chart show the months when the net growth in jobs is the greatest, and suggest when you can expect plenty of activity in terms of hiring and onboarding of new employees.
So what does seasonality look like for small businesses in accounting, law, finance, and healthcare?
Overall, Guideline’s data shows that the month of May is strong for small business job growth, which shows higher net employment increases in all of these industries as compared with either April or June. Because universities and colleges often let out for the summer in May, this bump might reflect both the beginning of internships for returning students and new positions for recent graduates.
For Finance and Insurance, May is also the strongest month for job growth overall. In contrast, Accounting, Tax, and Payroll has an annual high point in December, four months before the IRS tax deadline. This winter peak may be due to staffing-up for the busy season in these industries.
Job growth in Law fluctuates throughout the year, with peaks in May, October, and December. And Health and Social Services shows a rate of job growth that is relatively steady all year round. While there are seasonal factors in healthcare such as benefit enrollments at the end of calendar years, flu season, and deferment of non-urgent treatments during holidays, these factors do not seem to add up to create a major pattern of seasonality in small business jobs.
What does this tell us about the best time to look for a job?
If you’re looking to join a small business in an industry with a pronounced seasonality, such as accounting or finance, you may have the most luck if you start looking a month or two (or three) before that industry’s peak month for job growth. Conversely, if you’re looking for work in accounting, law, or finance in the fall, know that it might take just a little longer to find your match.
That said, small businesses in all industries have a continuous need to fill roles as they become vacant, and to meet their goals for growth, so the best time for you to search for a job is probably whenever you are able to put your best foot forward.
If you are looking for an easy, low-cost 401(k) plan for your small business, check us out! You can get started with Guideline at www.guideline.com, or email us at [email protected] to get answers from a specialist.
We analyzed anonymized employment data from over 9,000 companies that offer Guideline 401(k) plans. Our analysis counted job gains based on payroll data from company expansions and job losses from company contractions, but not gains and losses due to companies being founded or going out of business. Companies were classified into industries based on the North American Industry Classification System (NAICS) code each company selected in their Form 5500 publicly filed with the Internal Revenue Service (IRS).
Media requests, questions, and comments about this data can be sent to [email protected].