Calm Under the Chaos
Welcome back to the Recruitonomics Newsletter! This week was chock full of data releases: gross domestic product, employment cost index, and personal consumption expenditures. Read on to discover the what these data tell us about the recruitment space.?
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This Week on Recruitonomics:
Calm Under The Chaos: Spending Steady And Wage Growth Moderating
Our understanding of the economy is potentially at an inflection point. This week and next bring a slew of new numbers on inflation, consumer spending, job openings, and employment. So where do we stand today? This week’s data shows calm under the chaos. Chaos being: the threat of an upcoming recession, uncomfortably high inflation, a slowing housing market. But the calm is the recent movement towards a more stable equilibrium. Wage growth is cooling, inflation is not likely to get any worse, and consumer spending remains stable despite the difficulties.?
Read the full article here.
What does this mean for recruiters?
Recruiting has been difficult for the past two years – and the chaotic economy that we’re living in today is certainly not making things easier. Cooling wage growth – especially in sectors that recently made large gains – suggest declining momentum in a hot recruitment market.
Growth Rebounded, Despite Housing Market Slowdown?
An early estimate of third quarter GDP showed an encouraging rebound in growth. Inflation-adjusted output has been negative for two consecutive quarters, so this quarter’s rebound was a welcomed reversal. The strong growth in net exports was partly offset by declining residential investment. The Federal Reserve’s interest rate hikes have slowed the housing sector dramatically – and fixed investment overall is beginning to show signs of faltering. The Fed’s dogged pursuit of price stability will force investment even lower in the coming months.?
Read the full article here.
What does this mean for recruiters??
Despite this positive growth, economists surveyed by the Wall Street Journal still put the chance of a recession in the next twelve months at 63%. Economic turbulence is still very much with us – and navigating the worst of it will be a challenge for many months to come.
Housing Demand Slows, but Construction Employment Steady
The construction sector remains resilient despite a deteriorating housing market. The sector added 19,000 jobs in September – continuing to hire at a steady pace while home sales and new home builds faltered. As stated above, the Federal Reserve has taken a bite out of housing demand, but that has yet to spillover into construction labor demand. The employment numbers for October will be released on Friday, November 4th – can the sector hold onto its against-the-odds gains?
Read the full article here.
What does this mean for recruiters?
For recruiters looking for employees in construction, the steady gains are a welcomed sign. The pressure from declining construction investment will probably drive down employment demand eventually. In addition to steady demand for labor, recruiting costs in the sector may have reached a plateau last month. For more information, download the construction Labor Market Snapshot.?
Recruiting Tips:?
The answer to your recruiting problems may be programmatic recruitment technology. But, what exactly is it??
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Programmatic recruitment technology harnesses smart software to buy, place, and optimize job advertisements. In other words, it takes the guesswork out of job advertising. No more “post and pray;” welcome to advertising with confidence. Read more of Appcast’s Programmatic Recruitment Technology 101 to discover the basics of programmatic – and why 90% of companies that try it never go back.??
Coming Up From Recruitonomics:?
Join Labor Economist Andrew Flowers as he breaks down the most important takeaways from the October jobs report. Attend the monthly Recruitonomics jobs report chat at 10:00 am ET on November 4th!?
Recently on Recruitonomics:
Initial jobless claims decreased during the week ending October 15, signaling that layoffs remain very low. For the week ending October 22, these initial claims ticked up slightly, but remained relatively steady. After a notable rise late in the summer, it seems this proxy for layoffs has come back down to earth. The tight labor market allows for recently unemployed workers to easily find a new position. The very low levels of claims recently suggest a still-tight labor market – contrary to the lagged reports of cooling in job openings.?
Read the full article here.
There’s been an observable pattern of “labor hoarding” popping up in the last few months. While economic uncertainty soars, employers are deciding to forgo a sizable round of layoffs and hold onto the labor they have. The recruitment challenges faced in the past two years are prompting companies to rethink the trade-off between the short-term cost of a bloated workforce and the long-term rehiring costs. Even with high inflation and ever-increasing odds of a recession, layoffs have yet to meaningfully increase. High labor demand and the fresh memory of post-pandemic restructuring may hold layoffs steadily low for some time.?
Read the full article here.
Total civilian labor force participation has yet to return to pre-pandemic levels – but some age groups have had a harder time recovering workers. Prime-aged (25-54) labor force participation rates are nearly at the same level as February 2020: in September, the rate was 82.7% compared to 83% in February 2020. Teenagers’ (aged 16-19) participation rate has actually increased compared to levels in 2020, great news for industries that depend on low-wage positions, like leisure and hospitality. The two final age groups: ages 20-24 and ages 55 and over, are still lagging. This lack of engagement is especially puzzling for younger workers – what could be holding them back, now that college enrollment is decreased? Understanding where workers are missing should remind recruiters of the importance of expanding a job ad’s reach.?
Read the full article here.
What Recruitonomics is Reading:
Understanding the full long-term impacts of COVID-19 – both on the workforce and the physical effects – will take a long time. But the amount of people suffering from the lingering symptoms defined as long COVID may have increased the number of Americans with disabilities:?
“There has been a cumulative increase of about 1.7 million working-age people reporting a disability since mid-2020, the point at which disability counts began to reverse course after a years-long decline. Some of this increase may not be directly tied to long COVID (if the stress of the pandemic induced other medical problems, for example). But a recent study found that about a quarter of those with long COVID had altered their employment status or working hours, pointing to a condition serious enough to interfere with work for 4 million people. Thus a rough estimate that just under 2 million people have become disabled primarily due to long COVID seems plausible. Of note, disability counts were generally flat to declining in all categories for several years leading up to the pandemic, suggesting that these figures represent a conservative estimate of working-age adults disabled from long COVID. Somewhat encouragingly, disability counts have come down in recent months, suggesting some with long COVID have recovered to the point where they no longer consider themselves disabled,” writes Richard Dietz from the New York Federal Reserve.?
?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.