We are already more than halfway through 2017. The unemployment rate remains low and companies continue to hire across most sectors with the exception of retail. Currently there are only 1.2 unemployed persons per job opening, leaving employers struggling to find candidates that fit their needs.
A Few Observations
- We see a disconnect between candidates and employers, as it continues to be a candidate driven market but many employers believe and react as if it is still an employer driven market. Employers are accustomed to lower wages, as a carryover from the economic downturn, yet better compensation and advancement opportunities remain the most important factors for candidates in seeking a job change. Candidates have more options than ever when considering staying or leaving their current employer.
- It is challenge for a lot of companies to be able to adjust to the workforce changes that are taking place i.e. retirement of Baby Boomers and the expectations of Millennials. In order to successfully attract and retain Millennials, companies will have to be willing to embrace the culture change that is needed. Millennials (born 1980-2000) are now the largest sector of the workforce at 25% and will comprise 50% of the workforce by 2020. Generation Z (born after 2000) will comprise 20% of the workforce by 2020. So the two youngest working generations will comprise 70% of the workforce in the next three years. This is a huge shift in workforce culture.
- Candidates are open to hearing about opportunities but they are inundated with new positions, so offerings have to be significantly more attractive to get their attention. Candidates are looking for better compensation packages, opportunities to learn and advance; and improved work-life balance. Successful companies are making the changes needed for a successful hire. Job offers are rejected mostly because candidates accept another offer or the compensation package and base salary are not acceptable to the candidate.
- We are seeing a slowdown of layoff activity. US planned layoffs fell 28% in the first half of 2017 over the first half of 2016. The notable exception is in the retail sector at a 42% increase. With the tight candidate market, companies are choosing to keep the employees that they have.
There have been positive job increases each month since 2010. 2014 saw the largest number of new jobs created and there has been a slow decrease in new jobs added over the last two years. We know from history that there will be another economic downturn at some point. Different industries will experience this slowdown at different rates. Some companies, some industries are already seeing layoffs but at the same time, many of those companies are looking to hire people to bring new skills to their organization.
For the remainder of 2017, things will continue as they are. Hiring will continue but at a slower rate in some segments. Innovative companies will be looking to add new talent with new skills that can help get them to the next level. Candidates with skills that are in demand, technically related, will continue to be in demand and continue to have multiple opportunities to consider, although perhaps at a slower pace. Companies that are able to attract and retain new talent will be the ones that are able to successfully adapt and embrace the next generation.
Written By: Melissa Coleman, The Q Works Group.
Connect with Melissa on Linkedin to learn more about the author.