The US labor market showed mixed signals

By Karin Kimbrough, Chief Economist at LinkedIn

Mixed Signals 

The US labor market showed mixed signals in October. While the hiring slowdown appears to be tapering off, job seeking remains intact among professionals. What’s more, while low quit rates underscore how professionals may be hunkered down now, LinkedIn's Workforce Confidence Survey suggests they are planning to make moves in 2024. We also see some hints that seasonal hiring for the holidays may be more muted than last year.

US hiring is up

Hiring in October increased 4.1% on a monthly basis, an improvement from the 0.7% decrease observed in September 2023. On an annual basis the pace of hiring continues to slow, down 13% from a year ago, but marks the smallest decrease since September 2022.

Additionally, we see some signs of positive momentum. The net pace of hiring is up in the past 6 months in 5 of 20 industries we track. This is an improvement in the breadth of industries from last month when only 1 industry showed a 6 month increase.

Job seeking is still elevated 

Globally job seeking intensity remains elevated compared to a year ago. On average, job seekers are applying to more roles than a year ago or two years ago, suggesting a more deliberate and intensive focus on job seeking. In the US and UK, for example, applicants are applying to approximately 15% more roles than they did in autumn of 2022. To be sure, there are other possible explanations for an increase in this metric, but we believe it reflects the loosening conditions in labor markets as they become more competitive for job seekers.

When we split this by generation over time we observe that, while younger workers typically apply to more jobs on average, older workers are recently increasing their average number of applications the most. 

LinkedIn's Workforce Confidence Survey indicates a healthy pick-up in job seeking

Speaking of job seeking, at LinkedIn we regularly survey a sample of members to gauge their views on the workplace. One development worth noting is members’ expectations about changing roles. The current state indicates a low level of attrition in the US and many workers staying put in their current roles. But when we query their plans for next year, about 40% expect to change roles on average, and roughly 60% of GenZ plan to move on while just 30% of Baby Boomers are considering a move. It points to potential healthy increase in churn next year, particularly if the ‘will we/won’t we’ question of whether the US will dip into a recession is settled as a soft landing.  

Not many signs of a hiring boost for the holiday season

As we close out 2023, we want to highlight what we’re seeing in terms of the seasonal hiring patterns that typically show up. 

From July through October, the number of seasonal jobs posted declined by roughly half when compared to July through October 2022 period. Still, this decline is not as dire as it might seem: over the same period, the share of seasonal jobs increased by 15%, indicating that the number of seasonal jobs posted did not decline as much as overall job postings. The top sector for seasonal jobs remains Retail, followed in a distant second by Transportation & Logistics.

We interpret this as a potential sign of what retailers expect for their holiday season and whether the US consumer is sustaining their spending through the year-end.

Remote, hybrid, and onsite trends

The availability of flexible work options, both fully remote and hybrid, increased this month.  Through September, the share of paid open jobs offering hybrid work increased to above 20%, with 1 in 5 jobs offering hybrid work, up from 18% last month. Remote work accounted for a slightly higher share of jobs than a month ago, but the downward trend year-to-date suggests remote work could be waning in the medium run.

Apart from the ongoing tension we’ve observed between the flexibility that professionals and job seekers prefer and the concern some employers have expressed to attract workers back to the office, hybrid seems, for now, to be a compromise where each side gets a bit of what they seek. The stability of this compromise will depend on the relative leverage each side has over time. 

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