Last Friday, the Bureau of Labor Statistics announced that only 187,000 jobs were added to the labor market in July — the second consecutive month with less than 200,000 new roles after the June numbers were revised to just 185,000. This total is slightly lower than what economists predicted, but might be indicative of a market doing exactly what the Federal Reserve wants it to do (i.e., slow down). In comparison, the average monthly employment gain in 2022 was 400,000.
The unemployment rate, the metric that measures the number of workers who currently do not have a job but are looking for work, remained relatively unchanged as it dropped 0.1% to 3.5%, continuing the historic lows that we’ve seen since May 2022. Additionally, the labor force participation rate remained at 62.6% for the fifth consecutive month in a row; this metric is the percentage of the population 16 years or older that is either working or actively searching for work.
In July, the healthcare industry led job creation with 63,000 jobs added to the labor market — much higher than the industry’s average monthly gain of 51,000 over the past year. Residential care facilities, in particular, contributed 12,000 of these roles. Social assistance was second for job creations by adding 24,000 jobs last month, followed by the financial activities and construction industries, respectively, with 19,000 new jobs each. The leisure and hospitality industry only added 17,000 new roles in July, with 2,600 of those jobs in the accommodation sector. Overall, the leisure and hospitality industry is still down roughly 250,000 roles from pre-pandemic levels.
While last month’s BLS jobs report data was ambiguous to most, July’s paints a different picture: that of a labor market that is starting to find its balance between supply and demand once again. The equilibrium we’re looking for hasn’t been found quite yet, but there are signs that indicate that a gradual cooling is underway; the only issue is that the labor market itself is still showing a surprising amount of resilience.
While it was predicted that there would be permanent shrinkage in the labor market, this is not the case. This is due to a larger portion of women in prime working years actively participating in the labor force than before the pandemic, along with the reintroduction of immigrant workers to the labor market.
All of this is to say that it’s a better time to be an employer than it was the last three years. You’ll still face a degree of competition for top talent, but the desperation that has tinged the market should start to recede. Plus, with the Great Resignation officially over and done, you’ll see less and less turnover in your staff as long as you provide workers with what truly matters to them. This is great news because it means that you can improve your bottom line simply by keeping your employees happy; as we all know, a bad hire often costs more than one would think.
Read on to learn more about four changes you can make in your hiring process to recruit and improve your overhead with better hiring practices.
1. Own your hiring process
With the labor market finding its equilibrium, you can now pull back on relying so heavily on temporary workers. Job seekers want to find a permanent work home — especially in industries that have been struggling to source talent, like the hospitality and healthcare industries. Since the labor market is stabilizing, you will have more success directly recruiting and hiring these workers than you’ve experienced since the onset of the pandemic.
With an applicant tracking system, you can own your hiring process. You’ll be investing in your own company when you hire permanent employees in more than one way: you’ll save time spent by senior workers to train new hires, any fees that headhunters require to fill positions, and in terms of customer satisfaction (aka revenue). As we all know, time is money — money that you’ll be saving instead of wasting on poor fits and expensive temporary employees. With an ATS, you’ll have more insight into what recruiting channels are working and what’s not, so you can refine your approach to be the most effective for your business. There’s no one size fits all hiring solution so now is the perfect time to experiment on what strategies work best for you in this new post-pandemic hiring market. You could use candidate organization to keep track of previous applicants and employees during the busy seasons to further remove your need for temporary staffing; you can read more on that below!
2. Get creative with your recruitment methods
With turnover rates so low and workers more likely to stay at their current roles, you need a way to reach them. If you haven’t revised your employee referral program recently, you might be missing out on advancements that can make this recruitment channel more effective. Using a QR code generator can make submitting referrals easier for your employees; simply hang advertisements around your business in common areas that employees frequent and share during all-hands meetings. Referrals are, on average, hired faster, stay longer, and are more engaged in the company than typically candidates — all of which clearly makes the payout worth the investment in the right technology to manage this program.
Or, consider reinstating a tried and tested approach to recruiting: upping your physical presence at in-person events. Job fairs and mutually beneficial partnerships with schools in your community are in — and a particularly lucrative talent pool. These are great recruitment opportunities that are regaining popularity in this post-pandemic society. Since many organizations pulled back on attending these events, you should look at your policies once again and see if it would be worth reinstating these visits.
3. Redefine your candidate pool
If you’ve noticed that the labor pool looks different than it did just a few years ago, you’re right! For once, there’s a trend of younger workers forgoing higher education (and the accompanying debt) and going straight to trade work. Making sure that your current offerings appease this talent source will go a long way towards hiring the help you need; you can find more on what the modern employee looks for in their next role and in the job search itself in our 2023 State of Hiring Report.
Beyond redesigning your jobs and their descriptions, you should take advantage of any candidate organizational tools at your disposal. With this technology, you can keep a database of notes on previous employees and silver medalist candidates, aka those that you didn’t hire but would be a good fit. When you factor in boomerang employees and previous applicants, your talent pool begins to widen and sourcing the talent you need becomes a little more manageable.
4. Save time in the hiring process with automation
The one aspect of hiring that remains unchanged is the need for speed — and to remedy that, the one word you need to remember is automation. With automation, you can essentially set and forget multiple aspects of your hiring process to save your hiring team’s time and keep top talent engaged.
You can disqualify unqualified candidates with “knock out” questions in screening surveys; these questions can be as prescriptive as asking whether an applicant has a CPR certification in the healthcare field or if they’ve achieved an ASE certification for an auto tech. If a candidate answers in the wrong way, their application is discarded and your team doesn’t have to waste their time figuring out if they meet what your business needs in this role. You can keep talent engaged with automated candidate communication, too. This can be as simple as setting up an email or text message to confirm the submitted application to the candidate, along with details on what to expect next in the hiring process. You could even use automated candidate communications to request missing applicant information!
Takeaways
While the labor market finds the fine line between supply and demand, there’s never been a better time to hire in the last three years than now. The labor market is not shrinking at nearly the rate that was predicted, and workers simply want to work. You can capitalize on this change by making moves to own your hiring process, getting creative with your recruitment methods, redefining your ideal candidate pool, and using automation to hire faster.
For help hiring better talent faster, connect with our team at Hireology today!
