The Weirdest Job Market and Economy
We have low unemployment for just about every demographic group, including older workers. At the same time, we have sky-high inflation though not as bad as what we experienced in the late 1970s and early 1980s.
Wages are increasing at a rapid pace but those gains are being wiped out by inflation.
People are quitting their jobs in the great resignation movement as they are emboldened by a robust hiring market.
In certain sectors, technology specifically, employers are either slowing hiring or starting to lay off as they brace for a recession.
There are other sectors, like hospitality, that have had such difficulty filling positions that they do not want to lay anyone off.
A lot of economists are baffled by what is happening. Daniel Zhao, Senior Economist / Lead Data Scientist on Glassdoor‘s Economic Research team tweeted the following:
Initial claims rose last week to 244,000. Initial claims are now up 47% from their March low.
Continuing claims, however, dropped back down after a 1-wk spike in CA & GA. Still weird to see initial claims rise for 4 months but continuing claims remain flat. pic.twitter.com/0UVJ6RVOxg
— Daniel Zhao (@DanielBZhao) July 14, 2022
Are we headed for a recession? You can bet we are but who knows when.
Weirdest Job Market
The employment numbers look good but they hide deep disparities depending on where you live.
There was an article in the Austin Sunday newspaper a couple of months ago that stated that Texas was approaching having recovered all of the jobs lost in the pandemic BUT the jobs were different jobs and in different places. Houston, San Antonio, and El Paso were still significantly lower in jobs while Austin and Dallas/Fort Worth had gained significantly.
Houston is struggling as the oil and gas companies are recovering but not hiring. That is what happened in the downturn of 2015, it was a jobless recovery. San Antonio and El Paso have not come back as both are heavily dependent on manufacturing that has been constrained by supply chain issues. Austin and DFW both have large technology sectors but they are largely only hiring young employees. Here is the LinkedIn post I published with a snapshot of the article.
I published The Mostly Up but Hard to Decipher 55+ Job Market in 2022 in early June of 2022. The numbers continue to look good but some sectors are starting to lay off staff. I follow Layoffs.fyi Tracker and you will see this is primarily technology companies. Venture capital money is drying up rapidly. If you want to understand this trend listen to the Today Explained podcast episode The rise and fall of the “millennial lifestyle subsidy”.
I am also surveying job club leaders from across the country about what they are seeing. Almost everyone has seen attendance dwindle. Depending on the geography some are seeing members go back to work and at the same time, many are struggling.
Lots of folks catching COVID and the return to in-person meetings are on hold.
The Economy and Inflation
Inflation is bad. It is not as bad as the inflation we experienced in the late 1970s but it is still pretty bad. The effect of inflation hits lower-income households much harder.
When I was in Austin in April speaking at the Texpo Conference inflation was increasing but many believed it would go away soon. Unfortunately, it has not.
Large swaths of the economy are affected by the cost of fuel. The good thing is gas prices are coming down but will that continue? If you can answer that you can answer the question when will the Russia-Ukraine war end?
If the job market slows down this may actually be good for the economy. HUH!! Check out the article When Bad Economic News Is Good for the Fed.
In my Career and Industry Disruption presentation, I discuss that I have been trying to order a crystal ball on Amazon for the last 2 years but it is always on backorder. I want to be able to predict the future but we live in very unpredictable times.
Coping with Unpredictability
Back in January, John Tarnoff and I recorded the podcast episode 2022 Career Reality Check-In for the 50+ Crowd with John Tarnoff. We discussed what the end of 2022 would look like and we both agreed the end of 2022 would be as unpredictable as the beginning.
I hear from people in the United States that inflation has entirely been caused by US government spending. I live outside of Guadalajara Mexico and we have a lot of inflation here. The same can be said just about everywhere in the world. The reasons and the solutions for inflation are really complex.
I have learned to focus on what I can control and let go of what I cannot.
This is by far the weirdest job market and economy in my lifetime and I plan to do my best to enjoy the wild ride the rest of the year.Marc Miller