November 2023 Talent Market Insights
By TERRA Staffing Group
Posted on November 10, 2023
The labor market is showing signs of cooling.
150,000 jobs were added last month, a notable decrease and difference from last month’s hot labor market.
October’s soft job report shows moderate employment growth, an uptick in unemployment and mild wage growth. Yet, to the confusion of many economists, people are still buying things. And the economy overall, remains strong.
We’ll discuss what’s going on in the talent market and what this means for employers.
- 150,000 jobs added in October (falling below forecast of 170,000).
- Unemployment inched upward to 3.9%
- Workforce participation fell for the first time in a year.
- Wage growth continues to show signs of moderating.
Number of Jobs Available
There was a sharp decline in October compared to September’s gain of 297,000.
Leading industries in job growth included healthcare, social assistance, government and construction.
In the manufacturing sector, however, jobs decreased by 35,000 over last month due to strikes in the motor vehicle industry—which was responsible for 33,000 of that total number.
These numbers may change in November. At the end of the month, union workers reached a tentative agreement with auto employers to end the labor strike.
While unemployment changed little, from 3.8% in September to 3.9% in October, this is the highest the unemployment rate has been in since January 2022.
Though changes are slight month-over-month, we are seeing an upward trend in unemployment.
96,000 people are currently out of work due to a labor dispute or strike—the most since 1997.
And layoffs may be on the rise. Layoffs in October increased by 92,000, as many companies across the board made cuts to their workforce last month.
And at least 4 big-name employers have already announced staff cuts this month, which may affect the November numbers.
Adults working or looking for employment decreased to 62.7%, which is the first time workforce participation has decreased in over a year.
Something worth noting is that workforce participation among women has remained somewhat flat since May.
The number of full-time jobs grew by 326,000. And people who are taking on more than one job for economic reasons is the highest since 2019.
Overall, the minimal change in the workforce participation doesn’t paint a full picture, as many variables are at play “behind the scenes.”
Wage growth is continuing to cool off.
In October, average hourly wages only increased by 0.2%, following a 0.3% rise in the previous month.
And average hourly earnings dropped to 4.1% year-over-year in October, marking a decline from the 4.6% average seen in the first quarter of 2023.
Wage pressure may be easing due to more workers available and less people currently changing jobs.
Economic Variables to Keep an Eye on
Plenty of variables continue to influence the current economic landscape. Here are two that are worth paying close attention to:
- Due to the softer jobs report, Feds may be done raising interest rates for the current cycle.
- Labor strikes. Ongoing labor strikes continue to impact workforce participation and unemployment numbers.
What does this mean for employers?
Though the labor market shows signs of cooling, the competition for talent remains fierce. Added to which, employers face the challenge of retaining top talent and managing costs.
Here are some effective strategies to maintain a competitive edge:
Remain attractive to talent. To attract (and retain) talent, ensure your compensation and benefits are competitive and align with industry standards. Offer training, growth opportunities, and unique perks.
Nurture in-house talent. Turnover is expensive. Encourage and celebrate internal growth within your organization. Show your employees the growth possibilities within your company, so that they don’t seek them elsewhere.
Broaden your talent search. Explore alternative talent sources and don’t fear missing out on great hires. Consider candidates you might have overlooked, expanding your search.
Leverage temporary staffing. In an uncertain economy, temporary staffing could be a beneficial, cost-effective solution for your business. It not only provides some flexibility, it can help you meet productivity goals and project deadlines, regardless of market conditions.
Categories: Staffing Tips & Recruiting Trends