A jobs report released by the Bureau of Labor Statistics (BLS) last Friday describes a dream job market for American workers: lots of jobs, little competition and rising wages. But dream job markets don’t usually last long. Instead, they will be killed by the next recession. However, experts disagree on when that will be.
According to the BLS report, the US economy added 390,000 jobs in May, well above market expectations of 325,000, with total employment hovering near pre-pandemic levels. Meanwhile, the unemployment rate remained at 3.6%, its lowest since February 2020, confirming that the labor market remains tight, which helped propel earnings higher at an annualized rate of 5.2%.
“Today’s jobs report exceeded expectations and shows that the job market remains strong — if only for now — and workers are still looking to switch roles or industries for a position that suits their desires,” Cody Harker, Head of Data and insights at Bayard, a human resource marketing firm, told the International Business Times. In fact, Bayard saw a 3.52% month-on-month increase in click volume on job ads in May, with the largest increases seen in sectors such as leisure and hospitality, healthcare and professional services, suggesting that people working in these sectors work, eager are a change.”
A strong labor market gives job seekers great bargaining power in the employment equation, which translates into better employment contracts and more choices. “Workers are increasingly looking for higher wages to keep up with inflation, and we’re still seeing growing numbers of people switching jobs for financial wellness benefits like on-demand payments, savings plans and spot bonuses,” said James Neave, head of the Science at job search engine Adzuna to the International Business Times.
Harker agrees. “With inflation high, job seekers are prioritizing higher wages and flexibility in the workplace. In fact, the data shows that a quarter of all professional jobs in North America will be gone by the end of the year, so companies need to ensure that benefits and compensation packages are aligned with job seeker expectations,” says Harker.
Still, Neave is concerned about a recent hiring freeze in the high-tech sector. He believes the dream of today’s job seekers “could change quickly if the tech hiring freeze continues and we enter a recession.” Harker agrees and sees many more uncertainties ahead, such as higher interest rates and ongoing supply chain issues. “While companies are currently still actively filling vacancies, it will be important for job seekers to keep an eye on the market and be more cautious about changing jobs with fewer opportunities,” he says.
However, Bill Armstrong, President of Recruiting at Safeguard Global, does not share this scenario. “It’s encouraging to see that May jobs numbers beat initial estimates,” he told the International Business Times. “The number of vacancies remains near record highs with about two vacancies for every job seeker. This is an indication of a very strong job market that is not slowing down. Employers are still struggling to find talent, and while there have been some layoffs here and there, we haven’t heard from our clients at Safeguard Global about any large-scale cuts or hiring freezes.”
Only time can tell when the next recession will hit America’s economy and kill the jobs of the dream workers that are currently alive.
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