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Tips For Hiring In A Super–Tight Labor Market

By | Jeremy Zielie

Having trouble hiring in this super-tight labor market? You’re not alone. As the labor force shrinks, it leaves an unparalleled volume of jobs vacant. In fact, it is the highest it’s ever been, by surpassing 11 million at the end of July 2021.1

What is making the job market so tight? Simply put, not enough candidates are willing to accept the positions – leading to more open jobs than potential workers. With the unemployment rate slightly below 4%, the U.S. economy is close to full employment.2 This pressures recruiters to increase wages and offer special bonuses to entice workers who currently hold higher bargaining power.

What else can companies do to fill these vacancies? Some have responded by hiring candidates who may nothave all of the skills preferred for the position.

Additionally, employers are resorting to cutting their hours of operation and offering considerable incentives to employees who can start immediately. The health care and social assistance industry is one of the leading fields with high openings at 1.7 million.3 The leisure and hospitality industry follows behind at 1.3 million.4

Many are left to wonder why Americans are choosing to be jobless or are not actively looking for gainful employment. While the choice differs individually, some of the most common factors stem from the pandemic. Fear and uncertainty surrounding the contagion are still high and escalated in certain industries, such as health care.

Furthermore, prior to COVID-19, several of these industries were already short on staff and facing workforce issues. As people cautiously wait to see how the Omicron variant progresses – as well as when schools and businesses will fully reopen – they may be more likely to remain unemployed.

This leads to a second prominent reason: Generous unemployment insurance benefits, offered federally and throughout many states, are reliable enough for individuals to stay at home. These government policies and payouts, at times, reduce the necessity to earn a living while simultaneously increasing the aversion to accept low or average wages. When factoring in the costs of commuting, childcare, and more, it’s understandable why these enhanced benefits can make unemployment particularly appealing to populations that were already facing financial hardships.

The economic recovery from the pandemic is proving to be a difficult and slow process. It’s possible high demand for labor will recede. Until it does, many businesses may struggle to find qualified candidates. For further information and helpful tips on hiring in a tight labor market, please see the accompanying resource.

1 “United States Job Openings,” Trading Economics

2 “The Employment Situation – December 2021,” U.S Bureau of Labor Statistics

3 “Health Care & Social Assistance: NAICS 62,” U.S. Bureau of Labor Statistics

4 “Leisure & Hospitality,” U.S. Bureau of Labor Statistics

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Infographic created by Clover Network, a POS system company


[Sources]

https://www.dallasfed.org/research/economics/2021/0527

https://blog.clover.com/9-tips-for-hiring-in-a-super-tight-labor-market/

https://www.benningtonbanner.com/business/record-high-numbers-tight-labor-market-keeps-staffing-firms-busy/article_b2e16a6a-fadb-11eb-ab11-f7a275c1a604.html

https://www.cnbc.com/2021/08/09/job-openings-surge-above-10-million-for-first-time-ever-labor-department-says.html

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