As the economy continues to bounce back from pandemic-related shutdowns, businesses in the U.S. are facing a very competitive labor market. It can be increasingly difficult to find qualified, reliable workers, especially for in-person jobs. The hiring market is so competitive that many companies are trying to stand out in different ways, including providing sign-on bonuses, attendance incentives, higher base earnings, extra benefits, more perks, and more.
So what does the future of work look like for companies that are trying to build the best organization possible? Will this hot labor market continue? Or will we see a hiring freeze soon? Let’s dive into what’s going on today and a few predictions for the future.
Current Job Market
While the economy and labor market continue to recover from the pandemic, we do continue to see some uncertainty. The unemployment rate in the U.S. in July dropped to 5.4%, the lowest it has been since March 2020.
Predictions for the Future of Work
The future is always uncertain, but especially so now when we look at it through the lens of the last year and a half. We know how quickly things can change, but we also know how resilient and hardworking people can be. There are a few possibilities for what we might see in the future of the labor market, hiring, and work in general in the next few years.
Future Possibility: Unemployment Rate Continues to Fall, Hiring Stays Competitive
Goldman Sachs recently forecasted that unemployment rates would continue to drop, predicting that they would reach a 50-year low in 2022. Dropping unemployment rates would mean that the labor market will likely remain competitive, if not become more so. If this is the case, businesses will have to continue to create strategies to find the talent they need, when they need it.
Key Drivers: Unemployment Insurance Benefits Ending, Further Economic Growth
There are a few key drivers that could impact this future possibility for the labor market. One is the end of pandemic-specific unemployment insurance benefits given out as part of the CARES Act. These benefits ended on September 6, so we may see even further growth in the number of job seekers as part of that.
Another key factor will be continued business reopenings and economic growth. In March 2021, the U.S. economy had strong positive growth and appeared to be recovering quickly. However, with the surge of the Delta variant in COVID-19 cases, there has been more uncertainty lately over whether the economic growth will last or slow down again. Continued economic recovery could lead to lower unemployment and thus a more competitive hiring environment.
Future Possibility: Unemployment Rate Fluctuates, Hiring Market Fluctuates With It
Right now we have not seen the Delta variant slowing down hiring or increasing the unemployment rate. But that doesn’t mean it couldn’t happen. If we do see a slowdown in hiring, it’s possible it may be temporary, and we may continue to see fluctuations in the market for some time until external factors stabilize.
Key Drivers: COVID-19 Variants, Other Economic Factors
There is still a lot of uncertainty surrounding what the Delta variant and other possible COVID-19 variants will mean for the country. There is always a possibility that a new variant might lead to further shutdowns or a slowed recovery for some sectors of the economy. This could cause the unemployment rate to rise again, or continue to fluctuate as the situation changes.
It is also possible that we will see the labor market influenced by other economic factors, like additional COVID-related relief funds or industry-specific issues that may arise. There is always the possibility these will impact the competitive hiring environment we are currently experiencing.
Wonolo Can Connect You With the Workers You Need
In the meantime, if you are looking for flexible workers to help you meet your changing business needs, Wonolo can help. Wonolo’s job marketplace helps companies connect with experienced and available workers who are ready to hit the ground running. On Wonolo, you can post jobs based on your specific needs, and workers who are actively looking for opportunities can immediately view and accept those jobs. Plus, you can use the Wonolo app to favorite workers you have engaged with in the past so that you can easily re-engage them for future opportunities. Wonolo is the staffing solution you have been waiting for.