Companies Are Busier, So Will Hiring Pick Up Soon?

The unemployment rate may be stuck at 9.6 percent, but some economists are seeing a glimmer of hope for future jobs growth.

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Those with jobs are working more hours, and factory workers are getting more overtime, both signs that companies are busier. Though neither is at the point that signals significant hiring ahead, it's clearly moving in the right direction, according to some economists.

Average weekly hours for all private-sector employees reached 34.3 hours in October, nearly the level seen before the recession, and up from 33.7 hours a year earlier, according to data from the U.S. Labor Department, which issues a report on nonfarm payrolls each month.

Overtime for manufacturing workers—not including supervisors—has risen to an average 3.9 hours a week from 3.2 hours a year earlier, and 2.6 hours a year-and-a-half ago, according to the Labor Department.

“That’s a sign there’s more demand for product out there and companies are able to meet it with making people work a little longer,” said John Canally, economist at LPL Financial. “At some point, you exhaust the work force and you have to go out and hire new workers.”

According to Canally, overtime hours worked can be a leading indicator of future job growth. Six months after overtime hours hit a low in March 2009, the job market started to tick higher, he said. That pattern has been repeated over time—in both directions—with a rise in hours signaling future gains in jobs, he said.