August 4, 2023 - The latest labor numbers are in, and we asked Brian Miller, CEO of Patrice & Associates staffing and recruiting firm, a Conscious Capital Growth portfolio company, to share his take on the July Job Report.
CCG: What do you think of the latest report that job growth is slowing down?
Miller: What I see is that employment was roughly the same as in June. While there is a slight cooling off in the job market, it's still strong showing solid growth with an additional 187,000 jobs. That's a big number in an already tight labor market.
CCG: So, is this good news or not-so-good news?
Miller: This is great news for the economy because it reduces the fear that interest rate hikes could trigger a recession. Think of it this way, if companies are still adding jobs, there is optimism and need, so there also must be customers. In fact, the Fed Chairman said last week, “The central bank's staff no longer forecasts a U.S. recession, and 'we do have a shot' for inflation to return to target without high levels of job losses.”
CCG: That makes sense. Will this slight reduction in the number of jobs added make it easier for companies to fill positions?
Miller: I agree with the trend reported in Investopedia last month. It showed that there is a reduced labor force overall. Fewer people are participating, and this trend has been happening since the 1990s. It's recovered a bit from the big pandemic drop, but not entirely. Based on our open jobs, our clients are still struggling to fill their open roles.
CCG: Why is that?
Miller: There are a couple reasons. First Baby Boomers, one of the largest demographic groups in the U.S. are retiring and they've been retiring for some time now. Further, their children and their children's children make up demographic groups that are not nearly comparable in size.
CCG: In essence, you're saying the Baby Boomers will not be easy to replace, correct?
Miller: That's right. As the Baby Boomers leave the workforce, there will not be enough younger active workers to replace them. That means there will be labor shortages for the foreseeable future.
CCG: Won't the economies of the future play a role too, maybe even make it harder for people to find jobs?
Miller: The economy often has an impact, as does the industry and the skill set of the candidate, but the labor participation rate is affected by more than just those factors which will rise and fall, ebb and flow. Labor is influenced perhaps even more by socio-economic and demographic factors, which we can see well in advance and generally do predict trends.
CCG: So you're saying there's no end in sight and that companies need to get creative with their hiring to attract workers?
Miller: That's right. The days of placing an ad online and getting a flood of great candidates are over. No matter how powerful your logo is. Those great candidates are working somewhere else. It's a treasure hunt.
Full Report from the Bureau of Labor Statistics.
Brian Miller is a veteran staffing and placement executive and a labor industry watcher and commentator. To connect with Brian, visit Patrice & Associates at www.patriceandassociates.com.