In 2001, nearly 40 percent of employers instituted a hiring freeze, according to the William M. Mercer consulting firm. In early 2002, there are signs of a thaw. Manpower, the staffing services company, has found that 21 percent of firms expect to hire in the second quarter, compared to 16 percent in the first. There is growing optimism about an economic recovery and higher business demand.

But firms are being strategic, and are not hiring just to fill openings. For example, Goode Van Slyke Architecture in Atlanta is adding just two workers, and possibly a third. Hyperion, a business intelligence software provider in California, is hiring accounts payable employees instead of outsourcing the service. BigBand Networks in Fremont, California, is hiring cable operators in part because it believes that consumers will want entertainment, regardless of terrorism. It is also expected that firms will start to replace poor performers with more productive workers.

(Updated May 1, 2002)