The US economy created the fewest jobs in seven months in August as the hiring stalled in the leisure and hospitality industries and a resurgence in infections weighed on demand for in markets like restaurants and hotels that have been driving most of the hiring. August employment report show the US economy added 235,000 jobs last month, well below the 720,000 expected. A closer look at the sectors shows that the loss of 42,000 jobs in catering and drinking water was offset by gains of 36,000 jobs in the arts, entertainment and recreation sectors.
Here are some of the highpoints from the report:
- Household employment rose by 509,000 jobs – enough to push down the unemployment rate from 5.4% in July to 5,2%, the lowest level since March 2020. A broader measure of unemployment which includes people who either want to work but have given up looking or work part-time because they can’t find full-time work fell to a 17-month low of 8.8% compared with 9.2% in August.
- One key data point, the workforce participation rate, held steady at 61.7% as 190,000 people entered the labor market last month. While the initial indicators of lower unemployment may seem encouraging, the flatlining trend of the workforce participation rate simply means we are still in a very competitive, candidate-driven market.
- Negative Impacts for Minority Workers-The Bureau of Labor Statistics August employment report, released on September 3, shows a slight decline in the US unemployment rate and a rise in unemployment among black workers, despite historically high unemployment rates. The rise in black unemployment reflects their increase in the participation rate, the number of adults in work or looking for work, which had declined in the previous months. Although the unemployment rate rose in August, the increase reflects the dynamics of “labor-force participation,” as the total number of black workers employed rose during the month, but not relative to other workers.
What does this mean for your recruiting strategy?
If you’re not a nerd like me, all of these numbers can become a bit confusing. Honestly, there are times when I review the statistics and they appear to be telling conflicting stories. Here are some key take-aways from the data:
- Job creation is slowing down which would normally be a good sign but unemployment is also decreasing. If you combine that with the flatlining of the workforce participation rate, it all points to increased competition in the job market and the continuance of a candidate-driven talent landscape. How do you ensure you’re remaining competitive?
- Focus on fixing the recruiting feedback loop to help be the first to strike on qualified candidates. Find some tips and tricks on how to speed up the feedback process with these posts on recruiting feedback.
- Your current employees are one talent group often looked over. If you’re facing especially tight talent market conditions, you may want to consider reskilling or upskilling your current workforce. Here’s how to do it: Rethink, Reskill and Redeploy your Workforce.
- Focus on retaining your top talent. The recruiting landscape is hard enough so don’t complicate it by losing your top performers. Learn how leaders should recruit and retain top talent. This is one of the key KPIs of any strong organization.
- The negative impacts of the labor trends are affecting minorities the most. All of us should be hyper-focused on how to elevate, execute and measure our success in our Diversity and Inclusion efforts. It’s easy to tout how you’re an inclusive organization but it’s harder to actually execute a recruiting plan to target talent in under-represented groups. Here are a couple of suggestions:
- Create an effective Diversity Sourcing Plan.
- Examine your recruiting process to ensure it does not exclude important under-represented groups (URG). Read more.
- Focus on creating meaningful partnerships with organizations or community groups that can help you identify talent in URGs. I’ve always found being able to become a trusted partner not only benefits my organization for talent purposes, it also helps those organizations in your communities doing the real work. It’s a mutually beneficial proposition.
This year continues to baffle most of us who have been in the industry for a while. It’s a challenging talent landscape but it’s not insurmountable. Rather than focusing on the problem, try being creative and seek new solutions. For most of the industry, the complications of the pandemic and other economic factors have shown a light on issues that should have been addressed years ago. It sucks that it’s all happening at one time but this is a great time to break traditional recruiting methodologies and forge a new path.
What are the top economic conditions affecting your firm? What are some creative strategies you’ve worked on lately?
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