Wow, after what we’ve all been through—and we’ll spare you the full pandemic-to-present recitation of trials and tribulations—we may get to relax a little. At least when it comes to the labor market, the U.S. seems to be enjoying hiring that’s not too hot, not too cold. We’re hitting it just right!
That’s according to at least one economist quoted by CNBC, who opines that the job market is “near-perfect.” The U.S. Bureau of Labor Statistics shows continued strength in hiring but with slight weakening in the numbers, maybe just enough to slow Fed rate hikes. In fact, as outlined in the CNBC article, the August 2023 report put the labor market in line with 2015 to 2019 averages.
Employment is up but more people are entering the labor force, too, causing a slight uptick in the unemployment rate. Companies are feeling hopeful that after a tumultuous period, we might settle into that elusive balance where those who want to work can find jobs, but applicants also need to put their best foot forward to be successful.
If we are in a Goldilocks period, what will that mean for hiring and retention this fall and into next year? Here are a few prognostications:
What ‘Great Resignation’?
While we’re listing causes for celebration, let’s include this one: quit rates have finally fallen below 2019 levels! It seems the Great Resignation, which was trying employers’ retention practices, is officially over. Although maintaining employee engagement will never be easy, companies may expect a little less pressure from workers eager to bolt for greener pastures.
Quiet hiring takes over from quiet quitting
We’ve talked about quiet hiring before. We’re glad to see employers doing more to leverage internal talent and offer opportunities to enthusiastic employees. Rewarding capable, loyal workers—that’s a positive trend. “Quiet quitting,” on the other hand—the practice of doing the bare minimum to keep a job—may be a passing fad among workers, now that great jobs are slightly more difficult to come by.
Wage growth slows
Wage growth is following overall market trends, cooling without growing cold. That’s good news for employers that were struggling to boost compensation much further. At the same time, wage increases in some industries are now outpacing the cost of living, as inflation also slows. That’s good for employees, because it means real wages—the buying power of their take-home pay—is gaining ground. More Goldilocks!
Doors open to nontraditional candidates
Whether we’re talking gig workers, retirees interested in part-time or flexible work arrangements, individuals with disabilities, or simply those with nonlinear career paths, let’s just say description of an ideal employee has broadened substantially. Yes, it’s about diversity, according to the U.S. Chamber of Commerce, but not only in the traditional sense.
Recruiters are expanding their pipelines with all sorts of people who had long been ignored by traditional sourcing approaches. Employers are removing biased language from job descriptions, reevaluating formal education requirements in some cases when not central to the role, and updating vetting processes to get in on the nontraditional applicant action.
We learned to open our minds when workers were in short supply and it looks like we’ll keep them open from here on.
Face it—flexible work stays
The more things change, the more they stay the same—sometimes in good ways. Heightened competition for workers may have altered the labor environment forever. Even as Zoom ironically calls employees back to the office, workers continue to enjoy greater flexibility than was common in the past. Balancing some in-office collaboration and culture with some at-home work time—we can keep calling it the hybrid workplace or just say it’s the new normal. And flexible arrangements are not just for office workers anymore; frontline employees may be getting more choice and autonomy as well.
It’s been a while since one of our trends reports has turned out to be such a Good News Roundup. But we’ll take it, with a Pumpkin Spice Latte on the side. Oh yeah, we brought up that fall seasonal cliché—because we all deserve that kind of treat in ’23!