As we’ve by now grown accustomed to, the April jobs report is another mixed bag of good news and bad news. The positive? Payroll growth accelerated by 428,000 jobs, and the unemployment rate remained unchanged at 3.6 percent (or 5.9 million Americans). The modest surge in employment was more than anticipated by economists, and wages also continue to inch upwards, with an 5.5 percent increase since April 2021.
And these advancements all took place while we endure a tight labor market and the looming rise of inflation and interest rates, demonstrating strong employer demand and a resilient economy that is poised to return to pre-pandemic levels this summer.
First the good news.
Where the Gains Can Be Found
Ninety-five percent of jobs lost to the pandemic are now reportedly recovered.
Not surprisingly, the leisure and hospitality industries have experienced the biggest rebounds, adding 78,000 positions in April alone. The unemployment rate for this sector, which hit a staggering high of 39.3 percent in April 2020, is down to 4.8 percent, its lowest since September 2019. Average earnings are also up 11 percent from a year ago. (A caveat: With inflation running at 40-year highs, price increases for consumer goods have outpaced earnings growth.)
Other industries enjoying progress include manufacturing, transportation and warehousing, professional and business services, financial services, education, healthcare, and retail.
Areas of Opportunity
An alternative measure of unemployment (and one that doesn’t generally make the headlines) that includes discouraged workers and those holding part-time jobs for economic reasons, sometimes referred to as the “real” unemployment rate, edged higher to 7 percent. In addition, almost 500,000 employees decided to leave the workforce in April, while there are 11.5 million jobs that remain open. These factors exacerbate the pervasive problem of finding workers to fill positions and result in the widespread wage increases that help fuel inflation.
Employee engagement continues to be uncertain. The labor force participation rate, a key indicator of worker satisfaction, fell 0.2 percentage point for the month to 62.2 percent, the first monthly decline since March 2021 as the labor force contracted by 363,000. The level is of particular importance with a gap of about 5.6 million between job postings and available workers. Worker output declined 7.5 percent, the biggest slowdown since 1947 and the second-worst quarter ever recorded.
And then there is the larger economic picture.
The greatest challenge for employers is to meet the demands of today’s empowered workforce — higher wages to keep up with inflation, flexible working arrangements, and better benefits among them — while staying competitive. And as the Great Resignation now enters its “midlife crisis,” with older and more experienced workers joining the mass exodus, the most resilient organizations will be those that listen to what their current and future employees want and need to be productive, engaged, and effective.
Hiring for the Future Requires Vision
As recruitment specialists and experts in your industry, we go beyond the numbers and predictions to understand your singular business and hiring needs to meet this unique moment — no matter what the reports might read.