The pandemic continues to have lasting and irreversible effects on various aspects of life but the US labor market is, fortunately, showing signs of recovery. A recent data report from Talent.com, an online job posting platform with over 30 million jobs available in more than 75 countries, shines light on the US job market. From March to April 2020, the number of unemployed workers tripled, but fortunately that spike has continued to steadily decline. Unemployment in September 2021, however, was still up 40% from February 2020 before the pandemic started.
The Talent.com report includes data from the Job Openings and Labor Turnover Survey (JOLTS), the largest official survey on job recruitment, which shows a persistent increase in job openings and workers quitting their jobs yet a steady decline of unemployed workers, officially defined as individuals who receive government-assisted unemployment funds.
At the start of the pandemic, the data report illustrates the changes being seen in the labor market due to lockdown policies, school closures, and the worry over the virus. These factors all created a fearful approach when it came to going into the office. Since then, vaccines have been released and restrictions have slowly but surely been lifted as well as more companies making the switch to remote work across the country.
While unemployment levels are not completely back to what they were pre-pandemic, there are definitely some insights showing the road to recovery for the US’s labor market. Despite a small decline in August, corresponding to the rebound of the covid-19 infection rate, the monthly number of job openings has increased by 47% over this period as the labor market begins to recover from tightness it experienced during the pandemic.
Reasons for the Tight Job Market During COVID-19 in Certain Markets
Certain labor markets were hit harder than others during the pandemic.
From recent data Talent.com collected discovered that the sector for low-skilled jobs experienced the largest increase in tightness.
Lucas Martinez, a co-founder of Talent.com, explains the reasons behind this crazy phenomenon saying, “The first reason is mechanical. Remember that economists define labor market tightness as the ratio of vacancies over unemployed workers. As mentioned above, low-skilled occupations took the biggest hit in March and April 2020.”
The job posting platform’s data highlights the number of unemployed workers skyrocketed in these occupations. This led to a huge decrease in labor market tightness. As the labor market is recovering toward its previous state, the tightness in these occupations is increasing more than in other labor markets.
Behavioral Insights
Before the pandemic, more job advertisements were posted for high-skilled jobs, which data from Talent.com shows is changing as employers across all sectors are in need of employees, but particularly across low-skilled labor opportunities. For the report, Talent.com divided occupations into four categories: professional, including highly educated white collar occupations; Sales/Admin/Social Services comprising middle-skill white collar occupations; Food Prep/Retail/Personal Care including lower-skill service occupations and Blue Collar, including construction, production and related jobs.
Findings from the JOLTS report align with the average number of clicks per ad on Talent.com. After a stagnation period during spring 2021, the trend for employees quitting their jobs and the number of clicks per ad on the job board site both skyrocketed. The number of employees who quit their jobs increased 17% from May to August 2021, and the number of clicks per job ad increased by more than 60% from May to September 2021. Numerous studies have shown that as the economy and labor market are recovering, workers are more actively seeking to change jobs to improve wages and working conditions.
Labor Market Predictions for 2022
As data has previously shown, the number of unemployed workers is steadily decreasing back to its original levels before the onset of COVID-19. Martinez believes the U.S could expect to see unemployment levels in 2022 be closer to what they were before the beginning of the crisis.
Nonetheless, the other dimensions of the labor market have experienced changes during COVID-19 that have impacted and changed traditional ways of work. The development of work-from-home is huge and could in turn help with the labor supply by allowing the recruitment of workers worldwide. However, overall the outcome of the year still depends on the evolution of the pandemic.
