January 12, 2023 – Employers around the world are still expecting to hire more workers in the first quarter of 2023 with 12 of the 41 countries and territories reporting higher hiring intentions than the previous quarter, according to the Q1 ManpowerGroup Employment Outlook Survey. Employers reported a seasonally adjusted, net employment outlook of +23 percent. Hiring intentions decreased both year-over-year and quarter-over quarter by -14 percent and – six percent, respectively. Digital roles continued to drive most demand globally: Organizations in the IT industry reported the most optimistic outlook (+35 percent), followed by financials and real estate (+28 percent) and energy and utilities (+26 percent).
The net employment outlook, an indicator of economic and labor market trends, now stands at +29 percent, down four percent from last quarter and 12 percent from this time last year. The net employment outlook is calculated by subtracting the percentage of employers who anticipate reductions to staffing levels from those who plan to hire.
“This labor market continues to defy expectations with employers planning to add to their workforces across all key sectors for the first quarter,” said Becky Frankiewicz, chief commercial officer and North America president at ManpowerGroup. “Those with tech skills will find themselves in particularly strong demand.”
“The data does indicate some hiring slowdown in logistics and transport, yet we’re seeing employers being very intentional in where they pause hiring,” Ms. Frankiewicz said. “Many remember the challenges they faced to bring workers back post-pandemic and are keen to hold onto the talent they have. When wage growth and skills shortages persist, focusing on attracting and keeping those with in-demand skills will continue to be critical for U.S. employers.”
All 11 countries and territories in North, Central and South America reported positive employment outlooks for Q1, improving in three quarter-over quarter and two compared to this time last year. Employers in Canada (+34 percent) reported a moderate increase (+ three percent) in their Outlooks compared to last quarter, while the U.S. (+29 percent) and Puerto Rico (+26 percent) reported decreases, -4 percent and – 6 percent, respectively. In Central and South America, hiring managers in Panama reported the strongest intentions (+39 percent), followed by Costa Rica (+35 percent), and Guatemala (+32 percent); The lowest confidence was seen in Argentina (+ nine percent).
Employers in Europe, Middle East & Africa Expect Hiring Decline
EMEA employers expected hiring to soften, reporting an outlook of +18 percent. Intentions weakened – three percent when compared to previous quarter and -14 percent since last year. Outlooks varied across the region with employers most keen to hire in Austria (+29 percent), Turkey (+29 percent), and Israel (+28 percent), and the most cautious in Hungary (-8 percent), Poland (-2 percent), and the Czech Republic (+1 percent). France (+27 percent), the U.K. (+19 percent), and Germany (+17 percent) are among the countries continuing to report a net employment outlook in the first quarter.
Executive Hiring Predictions for 2023
With market uncertainty on the minds of senior executives as the new year has started, ON Partners recently asked its consultants to offer predictions and insights about the executive jobs they expect to be in demand in 2023. The past few years have seen one of the most volatile business environments in memory. Political, social, economic, health, and regulatory factors combined to form the perfect storm, creating a turbulent path for boards and those in the C-suite to navigate.
Hiring managers across APAC anticipated strong (+25 percent) but slowing hiring intentions, weakening since the previous quarter and year by -15 percent and –11 percent, respectively. Singapore (+33 percent), Australia (+32 percent), and India (+32 percent) reported the most optimistic outlooks, most cautious in Japan (+ eight percent) and Taiwan (+11 percent). Globally, the strongest hiring intentions in the financials and real estate sector were found in Singapore (57 percent).
Hiring by Sectors
Thirty-eight percent of employers within the consumer goods and services industry reported expectations to add to their staff during the first quarter, while 19 percent anticipated various decreases. Despite strong optimism to hire, the industry faces a talent shortage where 75 percent of employers reported difficulty finding the hard and soft skills needed. Forty-four percent of employers within the energy and utilities industry reported expectations to add to their staff during the first quarter, while 18 percent anticipate various decreases. In addition, 44 percent of employers within the financials and real estate industry reported expectations to add to their staff during the first quarter, while 16 percent anticipated various decreases. Despite strong optimism to hire, the industry faces a talent shortage where 75 percent of employers reported difficulty finding the hard and soft skills needed.
Thirty-seven percent of employers within the communication services industry expected to add to their staff during the first quarter, while 18 percent anticipated various decreases. Thirty-nine percent of employers within the industrials and materials industry reported expectations to add to their staff during the first quarter, while 18 percent anticipated various decreases. Despite strong optimism to hire, the industry faces a talent shortage where 76 percent of employers report difficulty finding the hard and soft skills needed. Forty-one percent of employers within the transport, logistics and automotive industry reported expectations to add to their staff during the first quarter, while 20 percent anticipated decreases. Fifty percent of employers within the IT industry reported expectations to add to their staff during the first quarter, while 15 percent anticipated various decreases. Despite strong optimism to hire, the industry faces a talent shortage where 76 percent of employers report difficulty finding the hard and soft skills needed.
“This recovery is unlike any we have ever seen – demand for skills is at record highs in many markets and unemployment levels remain high while workforce participation stagnates,” the ManpowerGroup report said. “Uneven economic growth continues with some markets recovering while others lag from soaring inflation and high cost of living.”
“Our report indicates that there are early signs of labor markets softening and hiring intentions moving lower given the economic headwinds we are experiencing,” said Jonas Prising, chairman and CEO. “Though employers say they are beginning to dial down their hiring plans in some areas, we still see strong demand for specific skills including IT, logistics, and finance.”
“Amidst a cost-of-living crisis, and a depreciation in real-time wages, companies need to think more than ever about attracting and retaining their workers – that might start with pay, yet our data tells us flexibility, career development, and purpose-driven work is worth up to five percent of salary to many workers,” Mr. Prising said. “There are lots of levers available for companies to attract and retain the talent they need to stay competitive.”
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media