December BLS Jobs Report — Labor Demand Still Outweighs Supply

Last Friday, the Bureau of Labor Statistics released the December 2022 jobs report to wrap up the previous year — which brought relief to many who have been watching the economy. Last month, 223,000 jobs were added to the labor market; while this was the smallest gain in the last two years, it was in line with what economists expected. The unemployment rate dipped down to 3.5%, which is the lowest we saw last year; this is both the lowest we’ve seen as a country since 1969 and matches early 2020 rates too. 

The labor force participation rate, which measures the percentage of eligible employees who are working or actively seeking work, rose slightly to 62.3%. Additionally, the number of unemployed persons decreased to 5.7 million while the employment-population ratio rose 0.2% in December to 60.1%. Even with the busy holiday season and competitive hiring market, Hireology customers were able to find the talent they needed in December 2022. Last month, our customers opened 17,040 jobs, received 478,948 applications, and had an average time-to-hire of 22.61 days. Not only that, but despite the market constraints, our customers made a cumulative 11,638 hires!

In December, leisure & hospitality led in job growth by adding 67,000 new jobs. Of these jobs, 10,000 were in accommodation alone, meaning that hoteliers are gaining traction hiring the talent they need to staff up at their locations. While this industry finished the year strong, as a whole it is still 5.5% behind pre-pandemic levels or 932,000 employees. On average, the leisure & hospitality industry averaged 79,000 new jobs per month in 2022, which was roughly 40% of the average growth seen in 2021. 

Health care was second in job creation in December 2022, with 55,000 jobs added to the labor market; of those, 9,000 were in nursing and residential care facilities alone. Unlike the leisure & hospitality industry, health care created an average of five times as many jobs per month in 2022 for a total of 600,000 new roles, compared to 2021 with 49,000 monthly gains. Construction was the third highest job creator in December 2022 by adding 28,000 new roles. All in all, the economy is still adding jobs at a pace that far exceed the historical average. In December alone, we saw two times the number of jobs created than we did in a single month before the pandemic. 

Other noticeable trends in hiring included losses in employment amongst state government education (-24,000), the professional and business services (-6,000), and warehousing and storage (-3,000). In December alone, 35,000 jobs in the temporary help services for the professional and business services industry were lost; since July 2022, this industry has fallen by a total of 111,000 jobs.

But what does this mean for business owners and HR professionals? 

Quite frankly, that depends on the industry you’re in. White collar workers are finding themselves in the midst of the recession that has been looming for the last six months as many have been laid off or let go from their jobs in the past couple of months. On the other hand, those companies that employed skilled laborers still have a voracious demand to add staff — despite a supply that simply doesn’t match the need. 

The good news: diminishing savings from the pandemic and the threat of a looming recession led many workers to seek out stable income in recent months. This has led to many companies who employ skilled labor in the last months to receive more applications and be able to fill their open roles much faster than in previous months. The bad news: there is such an imbalance of labor supply relative to labor demand for blue collar workers that there will never be a “return to normal” or full recovery.

With these insights in mind, there are three main takeaways from the December 2022 jobs report:

    1. Workers want stability — and employers want workers so they’re not typically firing employees unless they’re not showing up and doing the job they were hired to do
    2. Staffing agencies are seeing a dip in demand for temporary help works as business owners seek to decrease labor costs while keeping permanent employees
    3. Corporations across the country are cutting roles in the technology sector in order to save money; 5,000 jobs were lost last month in this white collar industry alone


The talent your business needs is out there, it’s just table stakes now to be able to reach them first and usher them through an efficient hiring process before your competitors have the chance to. Not only that, but your HR team needs to put vested effort into creating an environment that employees, both long term and new, want to continue to be employed at so that you don’t end up shelling out money to temporary staffing agencies that could have been better spent recruiting permanent employees and training them for their new duties. Read on to learn some tactics you can use to start hiring better in 2023.

Digitize your applications

Gone are the days when job seekers pounded the pavement to apply in-person with paper and pen — but that doesn’t mean that physical advertising is an avenue for promotion that hiring managers can (or should) write off.  In 2022, your open roles had to be marketed similarly to the products or services you provide in order to hire the talent that you need. 

By now, you’re likely used to competing with other businesses that are hiring who can move quicker in the process. In order to succeed, you need to reach candidates fast and first as job seekers currently on the market are only there because they’re either unemployed or don’t feel the level of security they desire at their current roles. Many aspects of the hiring game have already gone digital; it’s time for the way your candidates apply to follow suit.

By using applicant tracking systems (ATSs) that generate unique and trackable QR codes, your business can recruit new candidates when it’s convenient for them — and all on their phone! By using features such as Hireology’s TextApply, the process is easy: candidates simply scan the QR code on their phone and a chatbot collects basic information to create an application in about a minute. By strategically using QR codes in your marketing efforts for your open roles, you can receive applications no matter where the ideal candidate is. 

With the right ATS on your side, you’ll be able to hone this approach even further by using insights and analytics that determine which QR code placements drive the best ROI.

Payroll is where the heart is

Home may be where the heart is, but employee loyalty lies with the dollar. In other words: avoid making mistakes with your payroll processes to endear your employees to your company.

The economy appears to be balancing itself for the time being, but workers still want a tangible sense of stability — and that starts with their paycheck. As we mentioned earlier, job seekers are wary of the future right now since the threat of a recession has been looming over their heads for the last 6 months and inflation has raised the cost of living substantially. One of the major drivers behind new hires leaving their new roles within the first 90 days is that something was wrong with their paycheck, whether that was incorrectly entered information or simply missing data.

The easiest way to win your workers over? Start their career with you out right by using an ATS that integrates with your HRIS or payroll provider. That way, all of your new hire data will sync seamlessly with the other software in your HR technology stack so you can not only save your hiring managers time, but money in the long run that would’ve otherwise been invested in training new hires. 

Don’t underestimate the power of flexible scheduling

Over the last year, employers like you have had to cater to the wants and needs of the modern job seeker — and that’s often meant being flexible in your approach to scheduling. As you’ll come to see, flexibility is still an important part of standing out to potential applicants, especially as the job market begins to tilt back into your favor. 

In our latest hiring study, we found that by simply using a keyword like flexibility drives an influx of 40% more qualified applicants than those without. Not only that, but including flexibility in your recruitment marketing efforts was shown to lead to 50% more hires than jobs that don’t explicitly mention this important benefit.

In order to maximize the amount of time your employees spend on the job, consider staggering their shifts so that they can work as many (or as little) hours as they want, while your business continues to be productive. You can go the extra mile here by letting your staff be more involved in setting the hours that they do work. As a bonus, if your employees choose to work fewer hours, you’ll be able to save labor costs and increase your overhead. 

Add talent directly to your team

One of the most prevalent trends we saw in December’s report was that there has been a marked decrease in the number of temporary help services, specifically in the professional and business services industry. In this sector alone, 35,000 positions were eliminated last month.

If your business isn’t in this specific industry, take note: you can eliminate the costly middleman by adding talent directly to your team. It’s time to leave staffing agencies in the past with an ATS that works for your company. The right ATS will be capable of integrating the recruiting, interviewing, and onboarding processes to gain the hires you need faster. Not only that, but you’ll be able to reduce labor costs by adding permanent employees to your staff instead of temporary ones whose cost only compounds when you take the loss of overall productivity into account. 

The threat of a recession has been realized with white collar workers. Those who employ skilled laborers are at an advantage in the sense that the services and products they provide will always be needed — the major downside is that the labor supply is far less than what the current demand is. There are still workers out there who are seeking stability, but your company needs to be more proactive in putting your open roles in front of them, capitalize on ways to hire permanent workers, and set them up for a positive experience at your organization to really stand out in this hiring market. 

For six more opportunities that you can use to your advantage to hire better in 2023, download our latest study, the 2023 Future of Hiring Study, today!



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