January 8, 2019 – After nine years of steady growth, the nation’s economy charged ahead in 2018. Dark economic clouds, however, appeared on the horizon. Tariffs stoked fears of slowing trade that may cripple U.S. exporters and raise prices for consumers. The Federal Reserve raised interest rates three times, causing a slowdown in the nation’s housing market in a period when mortgages grew more expensive.
Meanwhile, the stock market slowed, leaving the S&P 500 index mostly flat.
One bright spot last year was workers’ paychecks. After years of stagnant wage growth, pay grew at the fastest pace in nine years in October — a sign that today’s healthy job market is finally translating into better pay for American workers. Unfortunately, the spoils of today’s booming economy aren’t being equally shared. Tech workers saw bigger paychecks and faster pay growth than many blue-collar counterparts, feeding existing fears about rising artificial intelligence (AI) and automation.
What are the next big workplace disruptions on the horizon? Glassdoor’s 2019 Job Market Trends Report outlines five job market trends expected to leave their mark in 2019 and beyond. Some of them are already in play today — disrupting the way companies attract, hire and retain talent.
Here is Glassdoor’s list of the top five workplace trends to watch in 2019 and beyond.
Prediction No. 1: Data-Driven Matching Will Be the New Paradigm for Hiring
The old paradigm for hiring is job search and application. In the pre-Internet era, the job search was limited to a local network of open positions found in places like newspaper classified ads. Today, a new paradigm promises to make a fundamental change to hiring in the years ahead: machine-learning assisted matching. “Today’s online job sites are more than just aggregators of job postings,” the Glassdoor report said. “They are employer review sites, career networking sites and job marketplaces that collect detailed data on all sides of the job market – data on people, companies, skills, and jobs. The new paradigm for job search uses big data and machine learning to cut through the clutter of online job postings and candidates.”
The philosophy is simple: Use data to curate a smaller, smarter set of job recommendations that better fit a candidate. This is possible by leveraging the vast amount of information on not only jobs and companies but also job seekers’ past learnings (such as personalized skills, education, and other professional experiences) and future aspirations (including job and company preferences, work locations, and more), said Glassdoor. “It’s a shift that promises to be a win-win for both candidates and employers in 2019 and beyond: Candidates get matched faster with jobs and companies that best fit their skills and preferences, and hiring managers get smaller pools of better quality applicants,” the report said.
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“The marketplace is growing and employment will grow but overall the economy is cautionary,” said Carrie Pryor, managing director of Greenwich Harbor Partners, a senior-level executive recruitment firm for the media and technology sector. “The low unemployment situation is only part of the supply issue as there is a specific shortage of talent for key positions. There is an accelerating need for all levels of people with tech-enhanced knowledge and experience in all functional areas including marketing, sales, product development, customer experience or finance.”
For example, said Ms. Pryor, if one thinks about the marketing function at all levels, people are now spending 80 percent or more of their time on data issues and not classic branding issues, the opposite from just five years ago. “This need for data analysis crosses all industry sectors including media, technology, CPG, QSR, financial services, pharma and business services,” she said.
Prediction No.2: The New Era of Tech Hiring Will Be for Non-Tech Jobs
The tech industry has been a jobs-creation engine in recent decades. In the early days of tech, most jobs at growing technology start-ups were strictly technical — software engineers, developers, and data scientists — aimed at building the infrastructure behind a company’s software and products. “But as the tech industry has matured, so has its workforce,” the Glassdoor report said. “As tech companies grow, they inevitably need to hire robust sales and marketing teams to transform technology into revenue. Operations teams expand as tech companies open new office locations. Even software engineers need HR teams to manage benefits and personnel issues. As the tech industry matures in coming decades, we expect to see an evolution in tech hiring — with more tech giants hiring for traditional, non-tech jobs as their businesses expand.”
This trend is well underway, according to Glassdoor’s own research. Last year, nearly half (43 percent) of all open jobs at tech employers on Glassdoor were for non-technical roles. “As the tech industry matures, we tech vs. non-tech jobs being hired by tech companies today expect to see much more hiring for these non-tech jobs that help drive revenue and scale up operations at America’s big tech companies,” the report said. “This trend is even apparent among one of the most high-profile tech hiring plans of 2018: Roughly half of Amazon’s planned hires for the two new headquarters in New York City and Virginia will reportedly be for non-tech positions.”
“As today’s tech giants expand their revenues, we believe they will need to ramp up critical hiring in non-tech roles to balance out their workforces in the coming decade,” Glassdoor said. “This shift in the tech workforce will likely impact company culture, pay, and benefits in the tech industry in the coming decades, including employers in non-tech industries such as professional services where tech competes for talent.”
With the new Democratic majority in the U.S. House of Representatives, the public can expect to see additional hearings into the behavior and plans of the big tech companies, said Ms. Pryor. “Many of them will make significant changes in senior management and their boards in response to their activities surrounding customer data mining and privacy and their heightened visibility,” she said.
When looking at technology in regards to how it will affect executive search, Ms. Pryor said, “Technology, specifically AI, will continue to have major impact on the operations of recruiting and executive search. Processes and tasks will continue to be improved and made more efficient thereby improving results and allowing employees to focus on higher impact activities.”
Prediction No. 3: More Companies Will Try to Get Diversity, Inclusion and Belonging Right
Many employers understand the importance of diversity and inclusion. But for many years employers focused on strictly addressing diversity. “That quickly led to a numbers game that emphasized better corporate reporting of women and underrepresented groups on payrolls as a way to improve the number of diverse candidates coming through the door,” said the Glassdoor report. “Although this was a healthy first step, it also led to a lot of corporate box-checking. It failed to address the underlying corporate cultural problems that made workplaces unappealing to women and underrepresented minority groups in the first place.”
“In 2019, we are entering a new era that focuses on the concepts of inclusion and belonging,” the report said. “If diversity means having a more diverse workforce, inclusion means having a culture that ensures they’re plugged into the organization — included in networking opportunities, on track for promotions, represented among company leadership, and so on.”
Belonging means feeling safe in the workplace to show your differences without being marginalized for it. Without inclusion, workforce diversity is a hollow statistical goal that’s unlikely to have a lasting impact, said the report. “Similarly, without belonging, companies will find it hard to retain more diverse candidates and benefit from allowing them to show their creative perspectives at work,” said Glassdoor. “More employers today are seeing that diversity programs cannot succeed long-term without both inclusion and belonging and we expect to see much wider adoption of these programs in 2019 and beyond and we expect to see more employers building programs that promote diversity, inclusion and belonging in 2019 and beyond.”
Diversity Recruiting: Supply, Demand and the Matchmaking Process
Hunt Scanlon Media recently released its latest issue of ESR. This time around, the newsletter offers an in-depth look at diversity recruiting – what drives it, why it’s not a social crusade, and how it matters in every workplace. According to ESR, diversity starts at the top – and that oftentimes means it begins in the boardroom. Diverse boards make better decisions and lead to improved company performance. But boards are failing to reflect society as a whole. What’s the problem? Hunt Scanlon Media provides some answers.
As you might expect, building cultures that will not tolerate discrimination but instead promote diversity – and recruiting talent that reflects this – is the challenge facing every recruiter and talent acquisition leader today. The #MeToo movement is, of course, leaving its mark on recruiting – and in this issue that is examined as well. Five incoming chief diversity officers making a big difference by putting a special emphasis on diversity are also highlighted. Get the free issue now!
Companies will continue to accelerate their efforts to have a diverse workforce where the overall environment if friendly and supportive of all employees, according to Ms. Pryor said. “Companies that historically have a low percentage of women and people of color and a ‘bro culture’ will be under increased scrutiny and pressure to have their work force more accurately reflect their customers and have a work environment where everyone feels valued,” she said.
Prediction No. 4: A Tidal Wave of Aging Workers Could Mean Labor Shortages for Decades
Many employers today are facing labor shortages. “One of the biggest trends we see coming in 2019 and beyond is a wave of demographic slowing in America that could mean tight labor markets will become the new normal for decades to come,” Glassdoor said. “Several current demographic trends point to an aging, more slowly growing, and less work-focused American population. Like a slowly rising tide, these demographic changes will have wide-ranging impacts on jobs, pay and hiring in the future.”
In the coming decades, employers will struggle to expand workforces for a few reasons, said the report. Of primary concern is the aging population. The first wave of Baby Boomers reached the retirement age of 65 in 2011 and millions more will continue to do so in the next few decades. That’s both shrinking the nation’s pool of experienced workers and changing the age profile of American consumers. By 2035, for the first time in history, there will likely be more retirees in America than children under age 18. A falling birth rate, which hit a 30-year low last year, is another cause of a shrinking labor pool that employers must face in the future. It all points to a tough road ahead for employers. “The supply of talent in many fields will be growing slowly, despite rising consumption and spending from retiring Baby Boomers as they buy housing, healthcare, travel, personal care and more,” said Glassdoor. “That combination of rising consumer demand, along with a slower-growing labor force, is the main reason we expect to see tight labor markets for the next few decades in America.”
Prediction No. 5: More Job Seekers and Employers Will Brace for an Economic Recession
The economy has been marching forward for nine years. As of December, U.S. employers have added jobs for 99 consecutive months, the longest expansion on record since the 1930s. Riding a wave of low interest rates, a booming tech sector, and historically low unemployment, many young Millennials today have never experienced an economic slowdown let alone a full-blown recession during their careers.
But cracks in the economy are starting to show. The Federal Reserve is steadily raising interest rates, increasing the cost of mortgages. The housing market is slowing. Tariffs are threatening the 10 to 15 percent of the economy driven by trade. The riskiness of corporate debt is rising, with a record $3 trillion in low-grade corporate bonds today. “The yield curve — the relationship between Treasury bond yields and maturity dates — is close to reversing its usual upward slope, a phenomenon that has historically been a good predictor of recession around the corner,” Glassdoor said. “In 2019, we expect more employers and job seekers will brace for an economic slowdown. Although there are many economic risks on the horizon, by most measures today the odds of a recession in 2019 remain low.”
“A big unknown is how the tariff wars in Washington, D.C. and other world capitals will impact U.S. businesses,” the report said. “American companies have learned how to operate under complex regulations but will those regulations be significantly altered and will that be to their detriment is a big unknown. People across all industries could find their careers in jeopardy because of their company’s revenues and profits under siege due to tariff wars,” Ms. Pryor added.
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Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; Stephen Sawicki, Managing Editor; and Andrew W. Mitchell, Managing Editor – Hunt Scanlon Media