The U.S. economy, and the labor market in particular, has vexed experts and observers for months now. Despite doomsayers predicting imminent recessions and others pointing to widespread tech layoffs as a harbinger of a more general end to the Great Resignation (and despite months of aggressive central bank interest rate hikes), recent data illustrates just how strong and stubborn certain labor market conditions still are.
The Yin/Yang of Workforce Data
While the U.S. economy added the fewest jobs in 2 1/2 years in June, data indicates a labor market that’s still pretty tight—a market that will likely result in more interest rate hikes from the Federal Reserve, says Lucia Mutikani in an article for Reuters.
“The Labor Department’s closely watched employment report on Friday also showed 110,000 fewer jobs were created in April and May, indicating that higher borrowing costs were starting to dampen businesses’ appetite to continue boosting headcount,” Mutikani writes. There was also an increase in part-time workers, likely due to an economic situation that’s driving jobseekers to consider new options.
Still, the pace of jobs growth remains strong when compared with historical data and is “showing an acceleration in services sector activity in suggesting that the economy was nowhere near a long-forecasted recession,” according to Mutikani.
A Mixed Bag
This news is a mixed bag for employers. A strong economy is generally good for business. At the same time, countless employers across the country are desperate for some relief in the labor market, which has been incredibly tight in the wake of the COVID-19 pandemic.
Nevertheless, the Department of Labor’s data does suggest that some sectors of the economy are seeing a greater supply of available labor than previously, and big tech layoffs are certainly an important component of that.
Staff-hungry employers should consider working greater flexibility into their hiring and recruitment policies to help take advantage of the slight increase in the availability of part-time workers and victims of recent tech layoffs.
Lin Grensing-Pophal is a Contributing Editor at HR Daily Advisor.