More “Wows” From the Jobs Market

Hello hello and welcome back to the Recruitonomics Newsletter! This week, we’re breaking down the latest jobs report in the United States – which was surprisingly strong. Check out what that means for recruiters below.?

Powered by Appcast , Recruitonomics.com is a hub for data-driven research that aims to make sense of our evolving world of work. Combining labor economics and recruitment best practices, Recruitonomics is constantly releasing new data and insights to bring clarity to the chaos of a changing economic landscape.

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This Week on Recruitonomics:?

U.S. Jobs Market Starts the Year Off With a Bang!

The U.S. labor market started off the new year with a bang! In January, the labor market once again looked very strong, adding an impressive 353,000 net new jobs in January, toppling market expectations. Unemployment remains at the low level of 3.7%, while measures of labor force supply flattened. This is a surprisingly hot start to the year but January’s data is often marred by statistical quirks. For example, in January 2023 the initial estimate for nonfarm payrolls was a whopping 517,000, which eventually was revised down to 482,000. However, this will not bolster confidence in the Federal Reserve to soon start rate cuts. This labor market might still be a bit too heated to inspire confidence in a slowing economy that will not prompt inflation to resurge.?

Read the full article here .

What does this mean for recruiters??

Although this was a surprisingly hot month for the labor market, recruitment costs are still down across sectors. This is still a strong jobs market, but the competition is much reduced for recruiters. The stable and boring labor market narrative still stands for recruiters, who are seeing much less competition as the new year begins.?

Post-Brexit, the UK is Becoming a Service Export Superpower!??

A few years ago, the United Kingdom split from the European Union, forever altering the flow of goods in and out of their country. Brexit has created several barriers to goods trading in the years since it’s been implemented. In the place of material goods, the people of the U.K. have turned to services exports. What exactly are services exports? As advanced economies become richer, they often spend more on services – think healthcare, education, leisure and hospitality, etc. Workers then export those services to other countries, which is becoming increasingly common and a larger part of international trade. Some growing services include tourism, financial and business services, law consultations, and more. The United Kingdom has become a leader in service exports in the past decade. The country exports around ￡470 billion worth of services yearly, over half of their total exports. In fact, the United Kingdom has a much higher share of services exports than any other large, advanced economy. In this post-Brexit world, the U.K. needs to focus on remaining a sizable services exporter, especially with the growing relevance of services within advanced economies.?

Read the full article here .

What does this mean for recruiters??

As recruiters in the United Kingdom survey the strength of the labor market, they should not forget about the demand for services exports now that the U.K. is a superpower in the area. Though demand could be down in the local labor market, opportunities for growth could remain.

Recruiting Tips:?

In case you missed it, this morning Sam Kuhn, Julius Probst, PhD, and I discussed the latest jobs report in detail, including insights on the recruitment expectations from this report. Check it out here !

Mark your calendars: The eighth annual U.S. Recruitment Marketing Benchmark Report is going live next Tuesday, February 6th! This report will include insights that will assist you in shaping your 2024 recruiting plans, with benchmarks across industries, states, and devices. Look out for the report on Appcast’s LinkedIn!

Recently on Recruitonomics:

About fourteen months ago, the explosively popular generative AI chatbot, ChatGPT, was released, creating an immediate uproar. If you had polled most economists before that date and asked what GPT stands for, they would have answered “General Purpose Technology.” Those GPTs typically come only a few times per century, and they tend to have a transformative impact on the labor market. ChatGPT (generative pre-training transformer) may transform the way we work just as much, if not more, than any GPT in the past. The question is: How will ChatGPT and generative AI more broadly affect the labor market in 2024 and beyond? Will the technology be labor-augmenting or labor-displacing? To answer this question, labor economist Andrew Flowers reviews academic research that empirically assessed ChatGPT’s impact on jobs. With this new technology, a whole new type of worker could emerge: The Centaur Worker. These half-AI, half-humans harmonize human expertise with AI capabilities. Find out where these “centaur workers'' might pop up and what that means for the rest of the labor market by reading the latest from Recruitonomics.??

Read the full article here .

Each first Friday of the month, we await the latest jobs numbers, which tell us the latest performance of the labor market. With all that awaiting, it may come as a surprise that these are just the initial numbers and are subject to (sometimes quite large) revisions. These revisions prevent accurate forecasting and can create a large problem for policymakers if they accidentally over- or underreact to the initial data. This has been particularly true in the post-COVID landscape, although it plagued Fed officials during the Great Recession as well. At the beginning of the pandemic’s recovery, revisions were unbelievably positive. Most months between January 2021 and December 2022 saw significantly higher job growth than what the initial data release suggested. These positive data revisions tend to cluster around economic recoveries. On the other hand, negative revisions tend to cluster around recessions: Jobs growth tends to look a lot worse in the rearview, looking back at a turbulent time. At the time of writing, the worry was that negative revisions seemed to be clustering. However, the latest jobs report, released today, saw a reversal in revision fortures. It bumped December’s gains up by 117,000 (November’s by just 9,000). It seems that we do not actually have to be worried about negative clusters, at least for now.?

Read the full article here .

What Recruitonomics is Reading:

The Federal Open Market Committee decided to hold interest rates steady at their current rate this past week, amid evidence that their tightening cycle has truly paid off. The Federal Reserve has been working for over a year and a half now to bring down the most turbulent bout of inflation since the 1980s. In the process, they have raised interest rates to their highest point in over 23 years. In many ways, it has worked impressively well. By some measures, core inflation has already fallen below the Fed’s 2% target – but the economy itself has remained strong, with healthy labor market fundamentals and stable growth. There’s little question among economists: The Fed will cut rates soon. But this week’s meeting was not the day, as the benchmark federal funds rates range remained between 5.25% and 5.5%. As Jerome Powell said on Wednesday , the committee has to gain even more confidence in the longer-term inflation trend before cuts can begin.?

?More Data & Insights:

? Push and Pull Factors: Migration to OECD Countries at Record High

? The Impact of AI and Automation on Recruitment Dynamics

? UK’s GDP Growth Looks Nice on the Surface

Thank you for reading! Stay tuned for next week's Recruitonomics Newsletter and check out Recruitonomics.com for more data-driven insights.