A Soft-Landing is in Sight
Hello and welcome back to the Recruitonomics Newsletter! This week, we’re looking at the latest U.S. jobs report and what it means for recruiters.
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This Week on Recruitonomics:
As Summer Ends, the Labor Market Cools
The labor market is definitely slowing, but the labor force keeps growing. In August, the U.S. economy added 187,000 net new jobs, and the unemployment rate increased to 3.8%. However, much of this increase came from an expansion in the labor force. The prime-age labor force participation rate moved up to 83.5%, the highest level in over 20 years. The Fed will likely feel confident in this cooling labor market – the soft-landing is definitely still on, with no recession on the near term horizon. Industry job gains were largely unsurprising: Healthcare made strong gains, leisure and hospitality was solid, and the Hollywood strikes are impacting employment in the motion pictures and sound recording industry.
Read the full article here.
What does this mean for recruiters?
In short, a less competitive atmosphere. While the jobs market is still tight, the uptick in participation will make recruiting easier. Demand has also fallen recently: Jobs opening fell slightly in July. The labor market is finally rebalancing.
Recruiting Tips:
The seasonal hiring rush is right around the corner! As it quickly approaches, recruitment teams need a boost of applicants to fulfill hiring demands over a short period of time. Strategic seasonal hiring starts with an efficient, outcome-driven sourcing process. As with all sourcing initiatives, the goal is to get the maximum returns with your available recruiting budget. Check out our piece, 7 Tips for Seasonal Hiring to help you effectively reach more seasonal candidates.
Recently on Recruitonomics:
The United Kingdom has a serious housing issue: Housing prices are far outpacing earnings, making buying a home nearly impossible. In London, the epicenter of this housing crisis, the average home price is now 13 times greater than earnings – meaning Londoners need to save for nearly a full decade to save up for a deposit. This increase in home prices has also, of course, contributed to a huge increase in rental prices over the last decade. Rents in London increased from about £1,400 in 2014 to £2,100 this year, while the average salary in London is about £57,000. The macroeconomic impacts of this dysfunctional housing market should not be underestimated: Productivity has plateaued in the United Kingdom, in part because workers are no longer able to move to these high-productivity cities like London. Better housing affordability may help with this productivity plateau, but it can only be done via an increase in supply. This would require an overhaul of the British planning system, which currently prevents the country from achieving its housing targets.
Read the full article here.
Recommended by LinkedIn
Southern European economies very much suffered in the aftermath of the Eurozone crash, falling into a deep downturn while northern economies thrived. But the post-COVID economic recovery has now led to a reversal of fortunes. In general, Southern European economies are currently outperforming those of Northern Europe, Germany, in particular. While Southern Europe experienced a stronger initial GDP contraction in 2020, during the first year of the COVID pandemic, the bounce back has been stronger too. While Germany’s GDP has completely stagnated since the end of 2019, France, Portugal, and Greece are up by 2%, 4%, and 6%, respectively. One reason why Southern Europe is booming is that tourism is finally picking up again. The tourism sector was close to 12% of Spain’s GDP just before the pandemic – that figure is similar for other Southern European countries – and Spain registered about 80 million arrivals.
Read the full article here.
What Recruitonomics is Reading:
Inflation has invaded consumers’ wallets for the past couple of years: Steep price increases have been impossible to escape at the grocery store, at the airport, and everywhere in between. While the impact of these rising prices have been obvious to consumers, the actual cause of this bout of inflation is less so. What do consumers perceive as the greatest cause of inflation? Economists at the New York Federal Reserve surveyed consumers to discover what they believe the largest contributions to inflation were. The consensus view was supply-side restraints caused inflation during the COVID-19 pandemic, in stark contrast to the divergence of views among economists on the same topic. This survey also asked consumers to weigh in on what drove inflation down in the past year, and what they expect to drive inflation down in the future. A majority agreed that the Federal Reserve’s action contributed to the inflation’s recent stabilization and will contribute to more softening in the future. Though studies in the past have claimed consumers tend to be imperfectly informed on the Federal Reserve’s actions, it seems that they have been paying attention during this tightening cycle and have recognized their power as such.
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.