According to the Bureau of Labor Statistics jobs report released last Friday, 390,000 jobs were added to the economy in May and the unemployment rate remained unchanged from the previous two months at 3.6% — carrying on the streak of the lowest unemployment rate seen since the onset of the pandemic.
The workforce participation rate increased in May to 62.3%, while the labor force grew by 330,000. Economists are using this metric to determine if the economy is finally balancing the labor supply and demand that has caused turmoil since the pandemic — and many estimate that the economy is starting to stabilize. Despite the overall trend of slower hiring, Hireology customers continued to build the best teams possible by adding top talent. In May, our customers created 24,317 new jobs, increased the amount of applications received to 404,869, and made 12,233 total hires.
Continuing to lead job creation, the leisure and hospitality sector led job creation in May with a total gain of 84,000. Professional and business services increased by 75,000, followed by the transportation and warehousing industry again with 47,000. The construction industry rounded out the pack by adding 36,000 positions in May.
What does all of this mean? The federal government’s attempts to cool down the rampant inflation are seemingly working, at least for now. Many speculate that the current wage increases — which rose by 10 cents in May — are unsustainable and need to slow down to control inflation.
While we’re heading in the right direction toward some hiring crisis relief, we’re not even close to there yet — especially since there are still around 1.9 open positions per job seeker. Despite these additions to the labor force, many industries like hospitality and retail still have a long way to go when it comes to being adequately staffed.
Many of the changes you’ve implemented to boost your hiring efforts will likely continue even after the labor market balances out. Changes that we’ve seen like increased options for flexibility and emphasis on mental health support are here to stay, not just bandages to help employees manage their work lives with the repercussions of the pandemic.
To keep your business operations running smoothly, equal efforts should be made to recruit new hires while also ensuring the complacency of current staff. Hireology CEO Adam Robinson shares his perspective on what businesses can do to navigate these shifting times:
Higher wages are no longer the only hiring solution
In a simpler world, higher wages would be the ultimate deciding factor for an applicant choosing between two positions. However, it’s not that clear cut in 2022. When competing in the gig economy, which we are still in despite the apparent cooling down, table stakes are much different than pre-pandemic norms. Plus, economists predict that raising wages are unsustainable for long into the future. So what can you do to sway applicants to your business if pay isn’t what applicants are looking for?
Major motivators for applicants include flexibility, better work cultures and environments, and the preservation of their mental health. For many industries, flexibility may appear impossible, especially for those that require personnel to work in-person, like hotel front desk clerks or automotive technicians. However, there are solutions available — you just need to be a little creative.
People want to be fulfilled and happy in the work they do. If you can’t offer flexibility, the next best thing your business can do is to have a strong mission and values that can be seen at every level of the organization. Supportive work cultures that care for their employees by nurturing their mental health and offer growth opportunities are the ones that continue to hire top talent and keep them on staff in this hiring market.
Consider how you communicate with candidates
While hiring might feel a little easier for many industries, others like hospitality and retail are still thousands of workers short of where they were in 2020. This return to “normal,” however, doesn’t mean to pull back all of the ingenious methods you implemented to attract job seekers during the height of the post-pandemic hiring crisis.
In particular, your business needs to reach applicants quickly after they express interest in your open roles. Instead of relying on emails to schedule interviews and communicate with potential new hires, it’s time to reach candidates in the way they like to communicate — through texting. Generation Z and millennials do not reliably check their inboxes, which are often clogged up with unread messages; they do, however, consistently check their phones for text messages. Among businesses that use texting to communicate with candidates, the average time-to-hire has decreased by 8 whole days.
Want to learn more about how modern job seekers think? Keep an eye out for our upcoming Applicant Survey, where we asked more than 6,000 applicants what their primary motivations are throughout the job search and application process.
Retention should be front and center
With the labor supply finally meeting the demand, there should be a shift in focus from attracting as many applicants as possible to ensuring that your current staff are happy. As you know, hiring is only one part of the problem; the other is keeping all of those new hires onboard for your business to keep running smoothly. After all, the last thing you want as a hiring manager is to constantly need to replenish your staff if they don’t stay.
Retention efforts don’t need to be convoluted, though. Like we discussed earlier, many job seekers are in the market for a new position because they were stressed out by their previous work environments and are searching for some relief for the mental burdens they carry; others simply didn’t see any room for advancement with the company they were previously with.
To keep your employees from joining the masses scouring job boards, take the time to show your appreciation. We don’t mean pizza parties here; instead, consider ways that your company can position mental health as a priority, for your employees and yourself. You can’t pour from an empty cup, and neither can your staff. By creating a work culture that emphasizes how much it cares for your employees, you can keep your employees happy — and your business running smoothly.
Another alternative to improve your retention rates is to map out clear career pathways for your employees. For many roles, like automotive technicians, it can be difficult to imagine themselves working in any other role in the automotive industry but that doesn’t have to be the case. If you have any employees who started out as a tech, use a testimonial from them on how they advanced their career within your dealership in internal communications to demonstrate that there is the potential for longevity.
Your best recruiters aren’t in HR
If you’ve put in the work to make your current employees happy, then you have the perfect opportunity to source qualified applicants from within your organization with an employee referral program. Your best employees are connected to hundreds of former colleagues, peers, and friends who trust their opinions — and would likely be thrilled at the prospect of working at a business that they already know treats their employees right.
To get real results from an already existing employee referral program, put a little more time and energy into it. You need to regularly communicate your open roles and participation guidelines to your employees at every available chance you get to ensure that your referral program runs at peak performance, along with setting the right bonus amounts in comparison to the positions being filled, and making sure that you’re paying your employees the bonuses they deserve for their help when you say you will.
Takeaways
May’s Jobs report revealed a lot of interesting insights, including the possibility of slowing down the current inflation. While the hiring power is shifting back to employers, that doesn’t mean that all of the extra benefits and perks you’ve been offering applicants can disappear, as they have become the new norm after the pandemic. By being mindful of how people commonly communicate, using incentives other than higher wages to attract applicants, placing extra emphasis on retention efforts, and revamping your employee referral program, your business can continue to thrive through 2022.
For more information on how your peers are attracting and retaining more talent, check out our Future of Hiring 2022 guide.
