The labor market is cooling, but this slowdown doesn’t equate to an easier hunt for job seekers.
Instead, it means stiffer competition. Job openings in April fell to their lowest level in more than three years, according to the latest numbers from the U.S. Bureau of Labor Statistics.
There were about 1.2 job openings per unemployed worker in April, down from a ratio of two openings per person about two years ago.
Yet people are still eager to switch jobs. In the U.S., LinkedIn has seen a 14% increase in job applications per opening since last fall, with 85% of workers saying they plan to look for a new role in 2024.
People might feel burned out or frustrated searching for a new job due to lingering expectations from the red-hot job markets of 2021 and 2022. But there are signs that the U.S. job market is strong despite economic headwinds like higher interest rates, Nela Richardson, ADP’s chief economist, tells CNBC Make It.
Job openings continue to trend toward pre-pandemic levels and the national unemployment rate is under 4%, a historically low mark.
Despite the labor market’s current challenges, Richardson says there are still plenty of opportunities for people who want a new and better job.
For much of 2023, companies felt like a recession was lurking around the corner and pulled back on hiring as a result — those fears aren’t gone yet, says Richardson.
Companies facing higher operating costs because of persistent inflation might limit hiring or take longer to decide on candidates to manage their expenses.
“This is normal,” says Richardson. “You never get a completely strong labor market, except if you’re recovering from a pandemic, which is what we saw in 2021 and 2022.”
It’s natural to have high expectations when searching for a new job. Still, Richardson says tempering those expectations can help you stay motivated and open to a wider range of opportunities, improving your chances of getting hired.
This is especially true for young job seekers, Richardson adds. “Yes, it’s going to take longer to find a job than it did two years ago, and no, you’re probably not going to start your career on Wall Street [or your top-choice employer],” she says. “You’re going to have to do what other generations of workers have done and work your way up to that point.”
The job market isn’t all doom and gloom.
There are pockets of strength in hiring, particularly in leisure and hospitality, health care, and government where job growth has been steady, BLS data shows.
Job seekers can take advantage of these opportunities by targeting roles in these “hot” industries, says Richardson. For example: If you’re looking for a job in tech, you could apply for tech roles at healthcare employers.
You can become nimbler and more marketable in an uncertain job market by highlighting transferable skills in your resume or application, including communication, project management, and collaboration, she adds.
And, you can use a tried-and-true technique to stand out in the job search: networking.
“In a crowded talent pool, you’ll have to work your pipeline to even get those first interviews now,” says Richardson. “Networking is coming back in style and is going to become an even more important skill for job seekers to leverage.”