When we last took a look at the U.S. Bureau of Labor Statistics “Employment Situation” survey (a.k.a. the monthly jobs reports we hear so much about), it was last fall. Omicron was just another letter in the Greek alphabet, the Great Resignation was all the rage and people were debating if they could gather safely with family and friends for the holidays, not to mention contemplating what the new year would hold for them, both personally and professionally.
Oh, how times change.
Fast forward to Q1 of 2022. It appears we’ve made it through the worst of the pandemic, with office reopenings on the rise, travel restrictions lifted and a wary acceptance of the “next normal” in all areas of our lives.
So, is that recognition reflected in the current employment viewpoint? Let’s take a look.
More Jobs Than People?
Corporate talent expert Josh Bersin has declared 2022 “one of the most dynamic years in our lives.” By “dynamic,” Bersin seems to mean that professionals will continue to leave their jobs at record rates — for more flexibility, better pay, improved benefits and other personal reasons. While the pandemic was the impetus for this “Great Migration,” a strong economy is sustaining this monumental shift in our workforce. In 2021, the U.S. economy bounced back, growing at its fastest rate since 1984.
After two years of lockdowns, the demand for literally everything is up. And, yes, this reality is causing major global supply chain issues and rising inflation as we race to keep up. These challenges are also conflating to create a glut of jobs that employers across industries are having a difficult time filling.
What the Latest Jobs Report Means for You
Despite the upheaval caused by the latest wave of Covid infections early this year, the January 2022 jobs report showed signs of encouragement for our economy and our employment outlook. However, the news was also a bit mixed (as has been the case in recent months).
First, the good news: The U.S. added back 467,000 positions in January, beating expert predictions of 150,000 new jobs. Major gains were made in industries including leisure and hospitality, professional and business services, retail trade, transportation and warehousing. Wages and labor force participation also markedly increased. This first report of 2022 comes hot on the heels of disappointing jobs data in November and December.
Now for the bad (or at least confusing): The unemployment rate rose to 4%, higher than in previous months. And, to add more murkiness to the mix, a report from ADP Research Institute revealed that companies lost more than 300,000 positions in January due to the Omicron surge. What’s to explain these discrepancies?
For one thing, the government and private institutions report jobs data differently. And, the ADP data was collected directly from its customers, which may have been more negatively impacted by Covid caseloads, childcare concerns over school closures and firings due to vaccination status. But, there has to be more at play here beyond the pandemic, right?
Accepting a Certain Degree of Uncertainty
As we navigate the next normal, economists predict that the labor market will continue to fluctuate. Workers who were sidelined will likely start reentering the job market in droves, but the flip side is that they may also have a new set of demands, creating a dichotomy for many employers. The irony of a strong jobs report is that higher inflation will accompany the higher wages needed to pay workers in a tight, competitive labor market.
If one thing is certain during this continual time of doubt, staying on top of economic and employment trends as well as your organization’s ongoing hiring needs is absolutely imperative. A trusted hiring partner who can help you build an agile, resilient leadership team is crucial to your company’s long-term success and its place in the future of work.