Another Month of the Jobs Market Beating Expectations
Hello and welcome back to the Recruitonomics Newsletter! Today is Jobs Day – and the U.S. jobs market remained strong last month, beating expectations again. Read on for more information, plus Canadian jobs day trends and our newest Labor Market Snapshots!?
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This Week on Recruitonomics:
US Jobs Market Beats Expectations Once Again
The U.S. job market has beaten expectations yet again. In April, payroll employment rose by 253,000 and the unemployment rate fell to 3.4% (a more than half-century low). However, gains in February and March were revised downward by 149,000. The unemployment rate for African Americans hit its lowest level in history. Average hourly earnings over recent months were firmer – a sign that wage growth remains elevated. Overall, the labor market continues to shrug off recession fears and is powering along nicely. Plus, the prime-age employment-to-population (EPOP) ratio rose to 80.8%, above its pre-COVID mark. EPOP is perhaps the best indicator of full employment – a sign that everyone who wants a job can get one.?
Read the full article here .
What does this mean for recruiters?
Full employment is great news for recruiters: a larger pool of workers to pull from means lower recruiting costs, reduced competition for workers, and easing recruiting pressures. The labor market is rebalancing – job openings are coming down (though slightly) and supply of labor is rising.?
Part-Time Positions Drive Job Gains in Canada
The Canadian jobs market remains strong but stronger for part-time workers. Canada saw another solid month of gains in April, but this time the increase was driven by part-time work. Employment increased by 41,400 last month, with increases in part-time jobs (+47,600) making up for losses in full-time positions (-6,200). The unemployment rate held steady at? a near-record low of 5.0%, the fifth month in a row the rate has remained at this level. Canadian employers should be happy to see the continued strength of the job market, proving resilient to inflation worries and the Bank of Canada’s tightening.?
Read the full article here .
What does this mean for recruiters?
The labor market remains tight – with job openings far above pre-pandemic levels in all industries. This tight market is driving strong wage growth, which is worrisome for the central bank in its fight against inflation. But, the Bank of Canada still expects inflation to ease and has stopped its interest rate hikes – Canada may achieve the soft landing that many advanced economies have been chasing throughout this bout of inflation.
The Wage-Price Spiral: A Uniquely British Problem??
Disinflation is finally happening among most advanced economies – except for the U.K., which might be heading for a wage-price spiral. Inflation is turning out to be stickier than in continental Europe and wage growth expectations remain elevated. The United Kingdom is the only G7 economy that still has a slightly lower GDP compared to the end of 2019. It is also the one country where inflation has proved particularly sticky and is currently still exceeding 10%. Additionally, wage growth in the U.K. has remained particularly strong, which is great news for workers, but worries the Bank of England, which is committed to its 2% inflation target. Now, the central bank is dealing with the possibility of a wage-price spiral, in which high wage growth fuels inflation, which feeds back into even higher wage growth, and so forth.??
Read the full article here .
What does this mean for recruiters?
Recruiters in the United Kingdom may have noticed how fast wages are growing for workers across sectors, but especially in the services sector. What they may not know is how that strong wage growth could prolong this bout of inflation, making the Bank of England’s job of achieving price stability more difficult.??
Recruiting Tips:?
领英推荐
Recruitonomics’ Quarterly Labor Market Snapshots are back! The labor market remains tight, though there has been some moderate cooling. The economy is in a transformative period, as interest rate hikes and shifts in the banking sector begin to make their mark throughout industries. In these snapshots, we break down how the sectors you recruit in are handling this shifting economy, and the impacts on recruitment costs. Discover employment, wage, turnover, and recruiting trends in eight top sectors:?
This quarter, a new layer has been added to these reports. For each industry, you’ll find one-year forecasts of cost-per-application, a key recruiting cost.?
Recently on Recruitonomics:
The economy is shaky but there’s a grounding presence in the form of strong consumer spending, seen in the first estimate of first quarter GDP. Last quarter, the economy grew by a subdued 1.1%. But, peeling back the layers of that subdued growth reveals that weak growth in inventories – which are very volatile quarter over quarter – concealed strong underlying growth, driven by consumer spending. Even with stubborn inflation and uncertain economic outlooks, people continue to spend strongly. How? Wage growth continues to be very strong. A still-tight labor market is driving steady wage growth, as the latest Employment Cost Index numbers tell us. That helps keep consumers out and about in the economy, spending strongly, and holds up the otherwise troubled economy.?
Read the full article here .
Eurozone inflation has been uncomfortably hot since the onset of the war in Ukraine. The area’s dependence on Russian energy doomed these economies to bear the weight of a commodity price shock. At the beginning of this bout of inflation, these commodity price shocks were the main culprit of rising inflation. But as time has gone on, inflation has become a more broad-based phenomenon – today, it seems to be driven by excessive demand. In economies across the eurozone, headline inflation has fallen while core inflation (which is stripped of food and energy prices) remains stubbornly high. This shift in price pressures clearly shows that inflation is being driven by factors other than commodity prices and supply chains, which have actually been disinflationary in recent months. This stubbornness in core inflation complicates the European Central Bank’s tightening policy and its ability to achieve 2% inflation.?
Read the full article here .
What Recruitonomics is Reading:
The Federal Reserve announced a tenth consecutive interest rate hike on Wednesday, a 25 basis point rise. This brings the target rate to the highest point in 16 years – the Fed is obviously committed to reaching its 2% inflation target. However, the announcement signaled that the Fed could be pausing rate hikes moving forward.
Don’t expect interest rate hikes anytime soon though – inflation remains high. But, with the level of interest rates currently and the slowing in the economy, the Fed can feel more confident that its tightening cycle has begun to pay off.?
More Data & Insights:
Thank you for reading! Stay tuned for next week's Recruitonomics Newsletter and check out Recruitonomics.com for more data-driven insights.