BURLINGAME, Calif.–(BUSINESS WIRE)–Magnit™, the industry-leading integrated workforce management (IWM) platform provider, today released the findings of its Spring 2023 U.S. Labor Market Report. The report revealed significant changes across the talent landscape caused by recessionary trends and economic uncertainty, including fluctuating employment rates and talent availability.
“Ongoing financial stress has motivated organizations to rethink their talent management strategies,” said Dustin Burgess, senior vice president of Magnit Strategic Advisory. “In today’s labor market, success hinges on leveraging data to make smarter decisions about hiring and retention while holistically looking at all labor when engaging in workforce planning. Leading companies are already doing this to gain a competitive advantage. They’re emphasizing a skills-based approach to hiring, utilizing market data to strategize wage increases, and tapping AI-driven analytics to identify redeployment opportunities. As a result, they’re seeing lower costs and more fruitful talent acquisition and retention initiatives.”
Magnit’s Spring 2023 Labor Market Report leverages the company’s expansive talent intelligence database to offer hiring managers and leadership unparalleled insight into the issues affecting full-time and contingent workforces. By analyzing billions of data points, Magnit’s research highlights areas of opportunity for organizations looking to optimize talent and augment their recession strategies. Key takeaways include:
- The growing demand for mission-critical technology. Although recent layoffs impacted the tech sector, demand for tech roles across industries is rising as organizations across sectors increase their reliance on IT and technology to protect and reinvigorate their business. Hiring for tech roles as a percentage of total hires saw the largest quarter-over-quarter increase in Q1 (34%).
- The waning acceptance of risk among talent. Over the last six months, layoff rates for contingent workers rose from 6.9 to 8.3%. Layoffs reached a four-year high in Q4 2022 but appear to be trending downward in 2023 to date. At the same time, the voluntary termination rate declined 24% quarter over quarter to an all-time low of just 12.6% in 2023 Q1 — less than half of what it was during the Great Resignation (29.1%). Furthermore, the spring report signaled a shift in worker priorities as the focus on company reputation rose nearly 5% among workers in Q1, more than tripling the typical variability.
- The ongoing effects of the gap between wage growth and inflation. In 2021, hiring volumes increased by 39% year-over-year (YoY) as the economy demonstrated resilience in many sectors amid the ongoing COVID-19 pandemic. However, wage growth declined during these months, turning negative in 2021 and 2022 and trailing inflation’s historic growth. Over the past 12 months, YoY wage growth averaged 3.5% while inflation averaged 7.5%.
Magnit’s report uses proprietary algorithms that aggregate, cleanse, anonymize, and analyze data from a variety of internal and external sources, including hundreds of client programs. The company manages data on hundreds of thousands of workers across over 51,000 unique roles, ensuring normalization without the risk of skewed data.
To learn more about U.S. labor market trends, download the full report.