- What You Need To Know To Land A Job In 2023
The latest labor market data confirmed that the job market remains remarkably resilient. In January, the U.S. economy added an eye-popping 517,000 jobs and the unemployment rate fell to 3.4%, the lowest in more than a half-century.
Still, even in a strong job market, fortunes vary as evidenced by recent layoffs at companies like Amazon +1.2%, Disney and Salesforce. So, if you want to switch jobs this year, you’ll need to be as strategic as ever in your search.
The State of the Labor Market. There are more openings than workers. The December Job Openings and Labor Turnover Survey (JOLTS) from the U.S. Bureau of Labor Statistics says there are 1.9 jobs available for every person seeking one. The main drivers behind this are the aging of boomers, curtailed legal immigration and declining population growth.
Remote work is here to stay. But expect fewer fully remote opportunities. Earlier this month, The Wall Street Journal reported that the return-to-office rate — a measure of office occupancy in 10 major U.S. cities — exceeded 50% of pre-pandemic levels for the first time since early 2020.
This doesn’t mean employers have abandoned remote work, but more are moving toward hybrid models that require employees to be in the office at least part of the time.
Pay increases are solid but slowing. As the labor market emerged in spring 2021 from the initial economic shock of the Covid-19 pandemic, wages and salaries started to rise. They are still rising, most recently at a 4.4% annual pace.
Job Search Trends. Video interviews are here to stay. According to the 2023 Career Industry Trends Report — a summary of findings from a career-service providers’ annual meeting called Career Jam — 82% of employers implemented video interviews because of Covid-19, and a whopping 93% of them say they plan to continue to do so.
Hiring managers prize skills over degrees. Companies like Walmart -0.2%, Google +0.7%, Apple and IBM +0.2%, as well as some state and local governments, have pledged to implement skills-based practices. This means that if you’ve got the skills, your lack of a degree may no longer be the deal-breaker it once was in some roles. The trend is still emerging, but career services providers report seeing more job postings requesting a degree “or equivalent experience.”
2. US labour market continues to be strong
The number of Americans filing new claims for unemployment fell again last week, pointing to sustained labour market strength and adding to financial market fears that the United States Federal Reserve could keep hiking interest rates for longer.
“The labour market shows no fresh signs of deterioration with minimal job layoffs despite the news of big tech firings the last several months, and this will harden the resolve of Fed officials to slow economic demand down with higher interest rates,” said Christopher Rupkey, chief economist at FWDBONDS in New York.
Initial claims for state unemployment benefits dropped 2,000 to a seasonally adjusted 190,000 for the week ended February 25, the Labor Department said. It was the seventh straight week that claims remained below 200,000. Economists polled by Reuters had forecast 195,000 claims for the latest week.
Unadjusted claims dropped 9,297 to 201,710 last week. The decline was led by the US states of California and Kentucky. There were notable decreases in claims in Michigan, Ohio and Texas. Big increases in claims were reported in Massachusetts and Rhode Island.
“It is possible that initial claims might not be fully capturing layoffs of higher-paid workers who might not qualify for unemployment benefits based on severance or might not file for benefits for some other reason,” said Veronica Clark, an economist at Citigroup in New York.
Economists also believed that seasonal adjustment factors, the model the government uses to strip out seasonal fluctuations from the data, were keeping claims lower. The seasonal adjustment factors for 2023 will be updated at the end of March.
3. What Layoffs? Many Employers Are Eager to Hang On to Workers.
More recently, demand has eased, and Home Run Inn Pizza, based in suburban Chicago, has reversed some of those measures. But it does not plan to lay off any full-time manufacturing employees — even if that means having a few more workers than it needs during its second shift.
During the height of the pandemic, hungry and housebound customers clamored for Home Run Inn Pizza’s frozen thin-crust pies. The company did everything to oblige.
There were fewer layoffs in December than in any month during the two decades before the pandemic, government data show. Filings for unemployment insurance have barely increased. And the unemployment rate, at 3.4 percent, is the lowest since 1969.
“We haven’t seen any layoffs whatsoever,” said Janis Petrini, a co-owner of an Express Employment Professionals staffing agency office in Grand Rapids, Mich.
For Federal Reserve policymakers, the surprising strength of the job market is a source of both optimism and concern. The low rate of unemployment suggests that a recession is not imminent, but also that the Fed has not achieved its aim in slowing down the economy.
For workers, the picture is clearer: For now, at least, the historically strong job market remains intact.
The persistent strength of consumer demand — and the continued hiring that it has driven — has been vexing for policymakers at the Federal Reserve. Fed officials worry that the strong job market is contributing to inflation, with employers raising wages to attract scarce workers, then raising prices to cover their higher labor costs. That could force the central bank to raise interest rates even more aggressively, ultimately raising the risks of a painful recession.
But the low rate of layoffs also points to the possibility of a rosier scenario. Higher interest rates typically result in higher costs and weaker sales, which often leads to layoffs. If companies respond instead by paring hiring or raises — while holding onto existing employees — that could allow the labor market to cool without widespread job losses.
There are signs that is happening. In earnings calls and investor presentations, corporate executives in recent months have begun talking about their efforts to cut costs and rein in spending, even in cases when their own sales remain strong. Some have instituted freezes in hiring, slashed bonuses or cut back on the use of contractors. But so far, they have mostly not resorted to large-scale layoffs as they have in the past, said Julia Pollak, chief economist at the employment site ZipRecruiter.
“The biggest story is the absence of layoffs — the absence of the layoffs you would normally see in response to higher interest rates,” she said.
Source: The New York Times
4. 150,000 Laid-Off Tech Workers Fuel Massive Wave Of New Startups – And They’re Actually Making More
A report from placement services firm Challenger, Gray & Christmas Inc. stated the technology industry led other sectors for the number of jobs cut in 2022. It found more than 97,000 tech workers received pink slips in the year, a 649% increase from 2021.
One of many impacts of the job cuts from 2022 that continue into 2023 is it adds many engineers, coders, business development workers and others back into the job market. Many of these workers will find employment with other tech firms, but others will take the opportunity to launch their own startups.
A survey of 1,000 laid-off tech workers conducted by Clarify Capital LLC found 63% of the respondents started their own company after their layoff. And tech workers reported they made more money after starting a company.
Accelerator Y Combinator reported a jump in startup applications of 20% in 2022 and noted the number of applications filed in January 2023 was five times higher than the previous year. An increase in startups creates new jobs and presents an investment opportunity for venture capitalists and individual investors to capitalize on exciting new startup opportunities.
Source: Yahoo! Finance
5. Are we headed for a recession? More economists think a 2023 downturn may come later than they thought
Forecasters have modestly upgraded their outlook for the economy and job market, and they now expect a recession to begin later in 2023 than they had thought.
Fifty-eight percent of the economists still say there’s more than a 50% chance of a downturn in the next 12 months, according to a panel of 48 forecasters surveyed Feb. 3-10 by the National Association of Business Economics (NABE). That’s about the same share as in a December survey.
But just 28% expect the slump to begin in this quarter, compared with 52% who held that view in December. Instead, 33% predict a recession will start in the second quarter and another 21% say it will begin in the third quarter.
A big reason for the improved forecast is January’s stunning 517,000 job gains and drop in the unemployment rate to 3.4%, a 54-year low. The jobs report, announced by the Labor Department early this month, portrayed a more vibrant employment market than had been captured by the steady slowing in monthly payroll gains late last year to a still robust 300,000 or so.
Who got the biggest raises: Airline pilots got sharpest pay increases since 2010; dentists, the smallest. See if your job made the list.
NABE forecasters now project average monthly employment additions of 256,000 in the current quarter, up from their estimate of 103,000 in December, according to their median forecast.
They also predict average job gains of 102,000 a month for all of 2023, up from 76,000 in December, and unemployment that rises to 4.3% by the fourth quarter, below the 4.5% that had been projected.
Booming job gains have bolstered Americans’ income and spending, which makes up 70% of economic activity. Consumption jumped 1.8% in January, the Commerce Department said Friday, the largest gain in nearly two years, despite high inflation, rising interest rates and a shrinking reserve of the additional cash U.S. households amassed early in the pandemic.
“I think the economy has proven to be more resilient than many economists expected,” says Ken Simonson, a NABE survey analyst and chief economist of Associated General Contractors, a trade group for the construction industry.
The NABE forecasters expect the economy to grow 0.8% in 2023 – based on the change in average GDP over the four quarters compared with 2022. That is down from 2.1% last year but up from their 0.5% estimate in December.
Source: USA Today
6. IT jobs in 2023: Look before you leap
Software developers who have been caught up in the recent surge of tech layoffs can expect to find plenty of job opportunities—they just might have to look beyond tech. Career experts say hiring remains steady in transportation, manufacturing, healthcare, and other sectors. All are looking for developers with the skills to create innovative products and services.
“We are seeing all industries hiring developers because they need to continue to support, or further develop, the technology that they have,” says Thomas Vick, regional director in Texas for the technology practice at employment agency and consultancy Robert Half.
“For most companies, the ongoing need for developers has continued even through hiring freezes or layoffs,” Vick says. “We are seeing that projects related to website refreshes [and] digitalization, security, and data/cloud migrations are the highest priority to most.”
High technology has become integral to nearly every area of business, resulting in an expanding field of opportunity for software engineers. Here’s a look at key industries currently hiring developers and the type of work that is available:
In financial services, developers are needed to create applications for e-commerce websites; budgeting programs; bookkeeping; online banking; tax management; and for financial forecasting.
In healthcare, there is need for applications and systems for electronic health records; medical practice management; online appointment scheduling; online medical billing; scheduling and patient management for specialty practitioners; telehealth; patient engagement; remote patient monitoring; electronic prescriptions; clinical trial management; and hospital management services.
In manufacturing, custom applications and systems are needed for production tracking; manufacturing scheduling; time and productivity management; supply-chain management; work-order management; computer-aided manufacturing; environment, health and safety software; accounting; preventative maintenance; and inventory management.
In the automotive sector, developers can build applications for real-time status tracking for vehicle maintenance; designing vehicle models; vehicle safety such as automated lighting and braking; vehicle navigation; vehicle diagnostics; dealership management; on-board diagnosis; fleet management; and automobile parts inventory management.
In insurance, they can work on applications for internal workflow automation; automating claims management and processing; telematics systems; chatbots for communications; fraud detection; and insurance data analytics.
There’s also hope for those wanting to remain in tech. Despite workforce reductions of late, these companies also have not stopped hiring developers.
“The lion’s share—80% of job postings—are still listed within the traditional tech sector,” Buber says. “The remaining one in five software developer jobs are spread across industries, including business and support services, manufacturing, engineering, education, healthcare services, financial services, and science.”
As for cybersecurity, organizations in every industry are looking to enhance their data protection capabilities, and developers have opportunities to create new security tools or make enhancements to existing applications.
In its 2023 Best Jobs report, released in January 2023, U.S. News & World Report named software developer the number one job. To calculate its Best Jobs ranking, U.S. News draws data from BLS to identify jobs with the greatest hiring demand. Jobs are then scored using seven component measures including 10-year growth volume, 10-year growth percentage, median salary, employment rate, future job prospects, stress level, and work-life balance.
7. Kroger is the latest retailer to spend big on employee wages as the job market tightens
The grocery chain will spend $770 million more on employee pay and benefits in 2023, it said after reporting earnings on Thursday. Kroger’s previous investments in compensation since 2018 raised the average starting rate at the company to $18 an hour.
The wage increases will be funded by cost savings, such as the increased use of technology to improve productivity in stores and “eliminating waste in areas that did not affect the customer experience,” CFO Gary Millerchip said during a call to discuss the company’s fourth-quarter results.
Those savings are expected to total $1 billion in 2023, marking the sixth consecutive year that Kroger has decreased costs by that amount, Millerchip said.
The Ohio-based grocer follows companies like Home Depot and Walmart in committing to raise wages this year. In February, Home Depot said it would up spending on wages by $1 billion and raise its minimum hourly rate to $15 across the US. Walmart said in January that it would increase its minimum wage to $14 from the previous $12-an-hour rate.
The higher pay is part of “labor hoarding,” or companies trying to keep workers for fear of not being able to fill positions if they leave.
Despite predictions of a recession in the US, the retail industry had the second-highest number of job openings of any sector at the end of 2022, federal data shows. US Unemployment rates have also remained historically low.
Source: Business Insider