eHire's Market Report, Wrapping Up 2023
From Resilience to Transformation: Labor Trends in 2023
In eHire's most recent Market Report at the end of second quarter 2023, we explored the talent market landscape, focusing on markets for in-demand or highly sought-after skills, rare and emerging tech talent, flexible work models (including in-office, hybrid, and remote models), prevailing perceptions, and competitive compensation. As we transition from 2023 and gear up for Q1 2024, the uncertain and challenging economic landscape provides us an ideal opportunity to offer an update on the present state of the talent market. Based on our observations and experiences, we'll comment on the most recent employment data, highlight emerging and pivotal trends, and provide insights to better guide hiring and talent decision-making.
September saw a notable slowdown in pace for private payroll additions, slowing from 177,000 new additions in August to 89,000 in September, missing the forecast calling for 170,000. However, the Bureau of Labor Statistics, which covers a more comprehensive view of the broader employment market, showed that job gains were grossly under-forecasted for September with the total coming in at a whopping 336,000 which outpaced the trailing twelve month average gain of 267,000 new jobs added by 26%.
However, the slowdown isn’t indicative of faltering progress, companies with 500 or more employees were primarily responsible for the missed forecast, being the only category to decline and wiping gains from August [Source]. Unemployment as a whole remains steady but is showing some minimal signs of softening, moving to 3.8% at the end of September.
Although over 240,000 tech workers lost their jobs in the last year, the tech workforce is stabilizing, suggesting a potential recovery in Q4 [Source].
In some positive news, the professional, scientific, and technical services sector experienced growth in September, aligning with the average monthly gain observed over the past year [Source]. Despite challenges, the tech industry has shown resilience. The unemployment rate held steady at 3.8 percent, with little change in the number of unemployed [Source]. The tech industry saw an employment rate change over the summer that indicates a positive end to the year.
Last year, around this time, there was a shift in the tech jobs sector. Now that we’re a year into the tech industry slow down, we’re seeing a stabilization. There is continued resilience in the sector as things are settling down. Larger corporations continue to go through changes while being more conservative with hiring, but those same corporations are driving some of the technology changes.
The most significant trend, however, is the challenge of attracting top talent. While we have previously discussed this trend, the context has evolved. Employees are now hesitant to change jobs unless necessary. Candidates are risk-averse, particularly due to the industry's recent trend of adopting a 'last-in, first-out' methodology for layoffs, leading to an anxiety-induced separation rate of 3.6% [Source], reminiscent of pre-pandemic levels.
Companies continue to need compelling packages for prospective employees. It’s still challenging to attract top talent with 98% of tech workers gainfully employed. Showcase your company’s stability and growth, commitment, and remote strategy. Speak the candidate's love language by clearly conveying the role’s impact on the company, the opportunities for growth, and how they will be challenged in this position. Lastly, don’t limit your candidate pool by an onsite or hybrid model. Evaluate your remote strategy to find what works best for your team.
You may also need to evaluate a strategic hiring approach for long-term hiring plans. Reduce reactive courses of action to become more efficient. Consider a proactive recruiting model for anticipated needs such as a highly critical role or specific positions with high turnover. This solution delivers qualified and decision-ready candidates so you don’t have to worry about downtime.
At eHire, we're dedicated to creating seamless recruiting experiences that support your unique needs. We value the talent acquisition process and are ready to use our expertise to bring qualified and skilled candidates to your team. Contact us today to learn how we can support and exceed your hiring needs and goals.