Though the job market isn't in tatters, there are plenty of loose threads, and they're likely to unravel further this year into full-fledged holes in some industries.
One problem, economists say, is that the job market will continue to feel fallout from the subprime mess despite about 153,105 job cuts announced last year at financial-services companies -- about three times the announced cuts each of the previous two years, according to Challenger, Gray & Christmas, a Chicago outplacement firm.
That's not all. Many economists predict a slowing economy ahead, and that means "there will be an almost across-the-board slowdown in employment growth," said Michael Montgomery, a principal with Global Insight, an economic forecasting firm in Lexington, Mass.
That means slower hiring, not necessarily rampant layoffs. And the degree to which slower hiring or even layoffs affect an individual worker will depend on many factors.
Still, plenty of economists see the overall labor-market outlook this year as tougher than last year's. In 2008, "unemployment will almost certainly creep above 5%," said Jared Bernstein, a senior economist with the Economic Policy Institute.
"While that is pretty low in historical terms, it's high enough that it's going to pinch some folks," he said. The jobless rate rose last month to 5%, a two-year high, according to the U.S. Labor Department.
Which jobs?Workers in some industries will be harder hit than others, said John Challenger, the chief executive of Challenger, Gray & Christmas.
"Bankers, lenders, Realtors, construction companies, even home retail and materials manufacturers -- the people who make roofs or doorknobs -- are probably the kinds of companies or industries that will see the heaviest job cuts," he said.
Also likely to get pinched further this year: residential title companies; mortgage brokers; insurance carriers, if focused on mortgage or home insurance; real-estate agents, brokers and others at investment banks and securities brokerages; home-materials manufacturers; home-improvement stores; and furniture retailers.
Workers involved in the securitization process may see fewer jobs, too. "That was the rage for years and years, securitizing these different products, whether houses or cars or credit cards," but that's on the wane, said Alan Johnson, the managing director of Johnson Associates, a New York compensation consulting firm.
Even architects and engineers might see a weaker job market. "We're seeing a bit of a slowing in commercial construction, and architects and engineers have been doing quite well in recent years. That's already begun to slow down," said Sophia Koropeckyj, an economist with Moody's Economy.com in West Chester, Pa.
The manufacturing sector continues to lose jobs. And though the weak dollar helps U.S. exports, that hasn't translated into more jobs.
"I suspect that at best we'll be losing jobs there at a slower rate," Bernstein said. "It's a highly productive sector. We may well be able to meet our export demands without adding much more employment."
Automakers and related auto-parts suppliers and dealers may also see more layoffs. Auto sales have averaged more than 17 million for a number of years, but Koropeckyj said she expects that to drop below 16 million for the next few years.
"That will force the domestic auto industry to cut back even more, and that will sweep up the whole array of various auto suppliers, too," she said.
Waiting for better daysCertainly, some job seekers will have a tougher time than others, and job-search timing may play a part. The economy created about 111,000 jobs on average per month last year, and that's expected to drop to an average 85,000 a month this year, Koropeckyj said. December's figure, however, was far lower than that: 18,000 jobs, the weakest job growth since August 2003.
The worst of 2008's job market will be concentrated in the first half of the year, when employment growth is predicted to average 72,000 new jobs per month, Koropeckyj said, versus 98,000 a month in the second half.
Through it all, health care is expected to remain a job-market stalwart. Educators are also in demand. Over the next decade, "there are a large number of teachers who are nearing retirement and who will have to be replaced at all levels of education," said Jon Sargent, an economist with the federal Bureau of Labor Statistics.
Industry watchers offer mixed outlooks for technology: It's been relatively strong of late and may not drop off too much, though there often can be "churn and volatility," Challenger said.
The consumer questionAnother possible weak spot: retail. Consumers hit by high gas and food prices, and the effect of lower home values on their net worths, may pull back on spending. That could affect hiring at various retail jobs.
But the U.S. consumer is often surprisingly resilient. "You can never bet against him or her, but most of us believe consumption is going to trail off significantly in this and coming quarters," said Bernstein, of the Economic Policy Institute.
One reason: "Wage growth has not kept pace with inflation in the last few months. Once you buy the groceries and fill up the tank, there's a lot less left for other purchases," Bernstein said. "Demand for labor is derived in part from consumer demand."
To the degree that consumers' and corporations' pocketbooks are pinched, nonprofit organizations could also get hit. "Nonprofits may be seeing fewer contributions and would have less ability" to add jobs, Koropeckyj said.
Financial services' effectsThe subprime-mortgage mess "has enormous knock-off impact," Johnson, of Johnson Associates, said.
"If you don't do deals, you don't need a lawyer. You don't need a printer. You don't need a late-night car service picking stuff up," Johnson said. "You have people like accountants, consultants, lawyers, all kinds of professionals that service financial-service firms, from caterers to limo drivers," affected by the industry slowdown.
Meanwhile, some states will see weaker job markets than others, Bernstein said, pointing to California and Florida because of their softer housing markets and to Michigan and Ohio because of concerns about manufacturing jobs. New York City will be hard hit by the subprime mess, Johnson said.Looking ahead over the next decade, the bureau says cashiers (other than gambling), stock clerks, telemarketers and computer programmers are among the 30 occupations likely to see the largest employment decreases.