August 23, 2021

The Job Market is Hot But New Hires Are Hard to Come by

Written by:
Reza Akhlaghi
Cat placeholder

A new report released by the US Bureau of Labor Statistics sheds light on the heated job market in the United States. By the end of June of this year, there were 10.1 million job openings in the US, with total hires and resignations hitting 6.7 and 5.6 million, respectively.

This data demonstrates a picture of the employment market that is bound to get heated well beyond the sizzling days of summer. In June alone the quit rates of US workers rose to a staggering 3.9 million jobs. Most sectors of the U.S economy experienced significant growth in job openings with professional and business services demonstrating the largest growth (+227,000). Other sectors of the economy with similar high growth rates in hiring and open positions were manufacturing, retail, transportation and warehousing, accommodation and hospitality.

A Whole Set of New Dynamics

There are three other factors that strongly impact talent acquisition dynamics in the United States: layoffs, and quit rates (resignations), and the delta variant of Covid-19. Data from the Bureau show layoffs and discharges remained low at 1.3 million, a 0.9 percent change; almost steady in June and May. On the other hand, the number of workers on a quitting spree in search of greener pastures continued to rise. The quitting number for this past June stood at 3.9 million, slightly lower than its 4 million mark in April. The impetus to quit jobs come from high vaccination rates that have resulted in business confidence in hiring with subsequent availability of greater job opportunities and a willingness to pay more for qualified talent.

As to the third factor, the delta variant has negatively impacted the confidence level of job seekers in their efforts to go back to work due to safety and health concerns.

 

From Resume Credentials to Skills as a New Currency in Talent Acquisition  

The pandemic upended hiring practices due to what appeared to be never-ending lockdowns and remote work. This led to a major shift in employment practices that had relied mainly on past job titles and preferred degree credentials to skills matching, including skills that are transferrable to other jobs and industries. According to LinkedIn, more than three-quarters (77%) of the jobs posted on its platform in Asia-Pacific this year focused on skills ahead of industry experience and specific job titles. This shift is pushing the market to accept cross-disciplinary nature of many jobs that offer job seekers with the right skills set to be qualified for open positions based on their skills.

As many employers have expressed, in this new environment they need to have the ability to match talent to opportunities. Resumes can no longer offer what HR and talent acquisition professionals seek to fill job openings, because resumes are pulled up from search results based on outdated keywords that are actually past job titles that have proved to be static and in need of frequent updating.

The above market dynamics have created the need to develop skills gap analysis tools, including the use of AI-based recruitment tools to simplify this process. They have also pushed academic institutions to infuse their curriculum with skills that the market needs.

 

Unbiased Skills Databases

As skills move to take center stage in job search and talent management, it is incumbent upon job seekers to highlight and foreground their skills in their job applications and demonstrate how those skills are aligned with the needs of employers. On the other hand, employers are advised to skill map the current skills that exist across their organization.

The US economy, as mentioned above, will only be able to overcome their post-Covid hiring challenges by relying on the skills of job applicants and their internal employees. Employers need also to be cognizant of transferrable skills of their employees to fill some of the existing job openings. This means with or without government support, the employers will have to embrace and utilize new technology including screening tools that shed light on skills rather than past job titles.

Human Resources Today