Hiring accelerated sharply in February as U.S. employers added 678,000 jobs to the economy — the largest gain since July 2021 and well above economists’ prediction for the month. Following January’s significant gains, February’s numbers are another sign of the economy’s resilience as we continue to recover from the impacts of COVID-19 pandemic that began two years ago this month.
The unemployment rate fell to 3.8% in February, from 4% in January. This is the lowest we’ve seen since February 2020. And the workforce participation rate inched up to 62.3% from 62.2% in January, which represents 304,000 people entering the workforce in February alone. Men between the ages of 25 and 84 participated in the workforce at the highest level since March of 2020. Black men in particular entered the workforce at a high rate during the month of February, with the group’s participation rate jumping to its highest level since 2018.
What this tells us is that as people start to feel a little more comfortable about working customer-facing or in-person jobs and as schools remain open more consistently and childcare becomes more available due to the declining COVID-19 cases. Employers’ efforts to offer better working conditions, greater flexibility, and higher pay have also made a difference here. At Hireology, we predict we’re going to start to see more and more of the workers we’ve been missing re-entering the workforce, making it easier for businesses to hire.
However, it’s worth noting that we are still well below the pre-pandemic workforce participation rate of 63.3%, meaning we’re still short workers. But the growth in recent months has been staggering and the upward trend is a sign that relief is coming.
Job growth in February was widespread across all sectors, but leisure and hospitality led the way again with nearly twice as many gains as the next highest sector, professional and business services. It’s again no surprise that this industry is gaining the most month after month. Businesses in this sector lost the most due to COVID-19 restrictions two years ago and therefore have the most to gain.
So, what does this all mean for you? For the second month in a row, we’re seeing signs that point to the end of the hiring crisis of 2021. While we’re still short millions of workers from the pre-pandemic number, the upward trends signal that folks are getting back to work and that employers might feel some relief as it relates to the worker shortage.
As we discussed last month, efforts to attract more workers and maximize applicant flow will always be important, but the key to success as we enter a new phase of recovery and more folks enter the workforce will be finding ways to connect with and hire the right candidates.
Here’s our advice:
Strategic candidate sourcing
First and foremost, make sure you’re strategically sourcing candidates. That means taking a look at how you write your job descriptions and where you post your open roles in order to reach the right community of job seekers with the right skills and maximize good fit hires.
Your job descriptions should be optimized for search based on keywords that are specific and relevant to your industry. They should be broken down into sections with subheads to ensure readability. And they should always lead with benefits and other perks for candidates — rather than requirements and responsibilities.
Additionally, rather than spending your whole budget pushing your openings on Indeed or other crowded job boards, take some time to figure out where your audience is actually looking and where your best hires tend to come from. For some industries, like hospitality, word of mouth might be a better way to find talent. In this case, you might want to invest more in your employee referral program. Or in auto, many of our customers are seeing great success finding technician talent by prioritizing relationships with local tech schools.
Efficient and effective hiring process
Next, make sure you have an efficient and effective hiring process in place. That means you need to have repeatable and predictable steps for your team to follow. Document exactly what your HR team needs to do and when after every application is received. How quickly should they respond to a new applicant? What should they do next if the applicant fits the job criteria? Without a solid process it’s easy for your team to skip steps or move too slow throughout the process resulting in lost candidates or poor fit hires.
Once you get the right folks into your process, it’s important to make sure you’re conducting better interviews to ensure you’re moving forward with the best of the best. You’ll never hire the right people by relying on gut feeling during interviews. This almost always results in making poor fit hires. Always include strategic behavioral questions that dig into how your candidate would react in certain situations at work. This helps you better understand their skills and work history beyond what they listed on their resume. And of course, be sure to ask every candidate the same questions to level the playing field.
And finally, if you have an influx of candidates, you will also need to find additional ways to weed out the best. In addition to strategic and structured interviews, skills tests can also help you identify the right folks for the job. And in some industries, in addition to knowing candidates have the experience and abilities to do the job, you need to know that they aren’t going to bring on any added risk. That’s where background checks and drug screens come into play. And with tools like Hireology, you can order verifications quickly directly within your applicant tracking system — allowing you to move fast without sacrificing quality.
While it’s important to remain cautiously optimistic, job growth in the last few months indicates that hiring may be picking up. Get ahead of the surge by setting yourself up to not only stand out in the eyes of top candidates, but also ensure that you’re hiring the right people for your organization. Hireology’s all-in-one hiring and HR platform is here to help. With Hireology you can run an employee referral program, move candidates through a fast and efficient hiring process, order background checks directly from the app, and much more.
Schedule a free demo to learn more today!