ST. GEORGE — The U.S. labor market has been on a cool track to recovery in recent months, shaking off most of the economic effects caused by the COVID-19 pandemic.
In April 2020, U.S. unemployment figures rose to more than 14.7%, the highest ever recorded. Now, almost two years after the start of the pandemic, the labor market has been through some turbulent waters. Overcoming the Great Resignation, which saw a record number of employees quit their jobs en masse throughout most of 2021, and the uproar caused by the Omicron variant.
In January 2022, the U.S. Bureau of Labor Statistics reported around 467,000 jobs added for the month, and 431,000 in March 2022, slightly below 460,000. Even though fewer nonfarm payrolls were added for March, the unemployment rate decreased to a remarkable 3.6%, inching closer to pre-pandemic levels of 3.5%.
While some employers have been on a hiring spree, looking to attract the right talent by offering higher wages, better medical care and other employee benefits, it’s clear that some sectors are outpacing their counterparts by the high numbers of recent hires.
Tourism, hospitality, retail, trade and transportation were hardest hit throughout the pandemic and ensuing lockdowns. But these are among the industries that have now shown signs of full recovery, even surpassing pre-pandemic levels.
Unfortunately, not all industries share the same job prospects, with government-related roles, financial services and information still seeing lower numbers of new hires even as the labor market is ripe with young and enthusiastic job seekers.
So who’s been winning, and who is lagging in the current labor market?
Trade, transportation and utilities
The trade, transportation and utility sectors reign supreme as the most active hiring sector. The increasing prevalence of eCommerce and online shopping is causing an increase in new hires. Looking at the numbers provided by the U.S. Bureau of Labor Statistics, this sector has, on average, hired more than 28,417 employees January-March.
The growing demand for warehouse workers, couriers, packers and messengers is likely spurring this sector’s positive and healthy job growth.
Professional and business services
Professional, scientific and technical services, management, enterprise, administrative and waste management is the second-largest and most active sector in the U.S. labor market.
Current figures indicate that professional and business services hired 22,000 new employees between December 2021 and March 2022. March saw its biggest hiring month, with more than 22,116 jobs added.
The uptick could be due to major companies and multinational firms adjusting their employee benefits, attracting exciting talent, and replacing some employees who have recently stepped into retirement.
Leisure and hospitality
During the pandemic, leisure, hospitality, tourism and service accounted for around 93% of all American jobs lost. Even though many restrictions have been waived until recently, this sector is still about 1.53 million jobs short between current employees and pre-pandemic levels.
The latest data shows in March 2022, the sector added about 15,509 new jobs. In addition, the accommodation sector itself added around 23,000 jobs in February, much better than what some experts had predicted.
Even though the sector accounted for more than 179,000 jobs in February, it’s still down 9% from pre-pandemic levels.
The economic shock experienced in the leisure and hospitality sector ranks among the many reasons job growth has started to plateau.
Even though the sector is showing signs of healthy recovery, there are still many job openings available, and many roles remain vacant, thanks to pandemic layoffs.
Latest reports indicated that the construction industry added about 19,000 jobs in March, which is still just 4,000 more than February 2020. The slow recovery has seen sector unemployment now inch closer to 7.63 million as of April 2022.
Luckily it’s not all doom and gloom, as its current unemployment rate of 6.0% for April 2022 is a significant improvement from the 8.6% reported in January 2022.
Even with construction seeing better employment results as we head further into the year, there’s still enough space for growth and opportunity. But overall, compared to other thriving industries such as services, trade, and transportation – construction may still have to add more jobs to catch up.
Mining and logging
Mining and logging is a sector struggling to keep up with rising operation costs and retaining many employees – even before the pandemic. Overall, things are not looking positive, with a -53.14% change in employment between 2011 and 2020.
Furthermore, annual average pay changes have also been relatively low, with mining seeing a 0.5% difference since spring 2020, a marginal amount compared to the 18.4% experienced in hospitality and leisure. Industries such as agriculture, fishing, hunting and construction saw average pay changes above the 4% threshold.
Even with some companies now looking to rapidly increase pay and wages for workers in the mining, logging and geological sector, it’s perhaps important to notice that the monetary compensation still doesn’t outweigh the physical and emotional toll these jobs have on workers.
In an article published by National Public Radio in 2021, an interview with a former gold and silver mine worker shows just how taxing the mining sector is and how daily work activities are taking a toll on some.
But even more, the article by NPR, supported by data from the Bureau of Labor Statistics, also reveals a more pressing matter. Around 20% of employees in the mining industry are currently aged 55 and older, while the median age for the average employee is 42. The sector is struggling to retain employees, but hiring them is becoming a major challenge.
With employees aging and many nearing retirement in a couple of years, the mining sector could be seeing major reform in the next few years.
Between the transition from 2020 to 2021, the labor market has already undergone major improvements. Considering the year ahead, we might see unemployment figures finally surpass pre-pandemic levels, as more employers are looking to hire and retain the right set of workers actively.
Additionally, the rising cost of living and inflation hitting an all-time high could drive more workers to higher-paying jobs as they reenter the labor market.
It could be a turbulent year for industries struggling to keep up with those sectors that have fully recovered from the pandemic.
Written by VALUEWALK, via Wealth of Geeks Network, for The Associated Press.