01/21/2022 Jeni Kramer

Job Market Insights: January 2022

And a surge-y new year

As the Omicron variant pushes the number of new (albeit generally less severe) COVID cases to new heights daily, we can almost feel the ground shift beneath our feet. From updated isolation guidance to another wave of school closures, everyone is doing their best to roll with the punches in hopes this current wave is nearing its peak. For now, we’re taking a look back on job market trends in December, and throughout 2021 overall, to see how we got here and where 2022 is likely to take us. (Just to be safe, I’d buckle up!)

On a refreshingly unsurprising note, active job listings declined in December. The 0.5% drop we witnessed in December is in line with a typical seasonal lull we’d expect to see pick up again in January, where we usually see an increase in both listings and job seeker interest. But even with the recent stall in job growth, half of states, and 62% of industries and occupations saw job listings increase in December.

December’s trend toward declining job listings hit Food (-7%), Sales (-3%), and Transportation (-3%) occupations the hardest. We saw the most jobs opening up in Protective Services, Community and Social Service, Cleaning and Maintenance, Business and Financial Operations, and Healthcare Support occupations.

Looking at 2021 overall, active job listings were up 53.6%. In fact, the only months we saw job listings decline in 2021 were November (where they were down 6.9%) and the previously mentioned drop in December.

A look back on 2021

Job listings grew in all states, sectors, and occupations in 2021. The increase across occupations was particularly substantial, with all occupations seeing listings grow by over 25%. Unsurprisingly the slowest to increase were those still the most affected by COVID.

Food Preparation and Serving Related Occupations were up just 25% in 2021, as restaurants continue to struggle with their ongoing staffing shortfalls. Job demand increased the most for Business and Financial (+96%), Computer and Mathematical (+79%), and Management occupations (68%) in the past year. 

Looking forward

Things appear to be on an upward trajectory now, but what does the rest to 2022 have in store? The market is strong for job seekers and workers are using this opportunity to make big steps in their careers and seek out the employers they prefer. Economists don’t expect this advantage in favor of job seekers will shift in 2022, even with the current COVID wave. They anticipate the rapid rate of quitting in pursuit of more favorable conditions will continue this year.

Turnover is likely to be a major focus for employers. In a difficult market, retaining valuable talent is critical. According to a poll by communications agency, Integral, that explores who’s likely to walk out the door and why, alignment with employer values significantly impacts staff turnover. 70% of employees say they are unlikely to change jobs in the next 6-12 months when the company actively reflects their values.

Obviously financial compensation will be another trending topic as well, with 2022 already being dubbed the year of the raise. Companies are allocating an average of 3.9% for payroll wage increases in 2022–the largest total increase since 2008–that will be meted out among existing talent and new hires. Though this may seem like more good news for workers, there is concern these large scale increases have the potential to drive inflation which is, of course, what they were meant to address in the first place. This ‘wage-price spiral’ often creates a catch-22 that only tighter monetary policy can fix.

So what will the market bring for the rest of the year? As we mentioned, economists expect that the advantage may continue to remain with the job seeker for the foreseeable future. But with some persistent focus on retention and what matters to workers, we may be able to strike a better balance in 2022.

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