Unemployment Rate Drops Slightly to 3.4 Percent

Defying forecasts, employers added 253,000 jobs last month, according to the latest Labor Department report. Employment in healthcare, leisure and hospitality, social assistance, financial activities, and government all saw gains.

May 5, 2023 – Employment rose by 253,000 in April as the U.S. unemployment rate stands at 3.4 percent, according to today’s U.S. Bureau of Labor Statistics report. The number of unemployed persons is 5.7 million in April. Employment continued to trend up in professional and business services, healthcare, leisure and hospitality, and social assistance.

Among the major worker groups, the unemployment rates for adult men (3.3 percent), adult women (3.1 percent), teenagers (9.2 percent), whites (3.1 percent), blacks (4.7 percent), Asians (2.8 percent), and Hispanics (4.4 percent) showed little or no change in April.

The number of job losers and persons who completed temporary jobs decreased by 307,000 in April to 2.6 million. The number of persons jobless less than five weeks decreased by 406,000 to 1.9 million in April. The number of long-term unemployed (those jobless for 27 weeks or more) changed little over the month at 1.2 million and accounted for 20.6 percent of the total unemployed.

“The 253,000 gain in non-farm payrolls in April suggests that the labor market remains resilient despite the banking sector turmoil and broader signs of an economic slowdown,” said Andrew Hunter, Capital Economic’s deputy chief U.S. economist. “Nevertheless, that stronger-than-expected gain was offset by sharp downward revisions to previous months, and, in any case, we doubt it will have the Fed reconsidering its plans for a pause given the wider evidence that labor market conditions are cooling.”

In raising rates on Wednesday, Fed chair Jay Powell said the labor market remains “very tight,” but noted “there are some signs that supply and demand in the labor market are coming back into better balance,” pointing to an uptick in participation among prime age workers (or those 25 to 54), as well as moderating wage gains and a drop in job openings. “But overall,” he said, “labor demand still substantially exceeds the supply of available workers.”

Where Job Growth Occurred

  • Employment in healthcare increased by 40,000 in April, compared with the average monthly gain of 47,000 over the prior six months. Over the month, employment continued to trend up in ambulatory healthcare services (+24,000), nursing and residential care facilities (+9,000), and hospitals (+7,000).
  • Employment in leisure and hospitality continued to trend up in April (+31,000), largely in food services and drinking places (+25,000). Leisure and hospitality had added an average of 73,000 jobs per month over the prior six months. Employment in this industry remains below its pre-pandemic February 2020 level by 402,000, or 2.4 percent.
  • In April, social assistance added 25,000 jobs, in line with the average monthly gain of 21,000 over the prior six months. Individual and family services added 21,000 jobs over the month.

Related: Preparing for Shorter CEO Tenures

  • Employment in financial activities increased by 23,000 in April, with gains in insurance carriers and related activities (+15,000) and in real estate (+9,000). Employment in financial activities changed little in the first three months of this year.
  • Government employment continued its upward trend in April (+23,000). Government had added an average of 52,000 jobs per month over the prior six months. Overall, employment in government is below its February 2020 level by 301,000, or 1.3 percent.
  • Employment in mining, quarrying, and oil and gas extraction rose by 6,000 in April and has risen by 102,000 since a recent low in February 2021. Nearly all of the April job gain occurred in support activities for mining.
  • Employment was little changed over the month in other major industries, including construction, manufacturing, wholesale trade, retail trade, transportation and warehousing, information, and other services.

Hiring Outlook

While recessionary concerns and layoffs continue to make headlines, the latest ManpowerGroup Employment Outlook Survey of nearly 39,000 employers in 41 countries and territories finds their appetite for hiring continues in the second quarter of 2023. The optimism remains despite organizations struggling to activate their hiring plans with global talent shortages reaching 77 percent, a 17-year global high. Hiring intentions remain unchanged from last quarter at +23 percent, while employers continue to have difficulty finding people with the right skills.

Executive Hiring Predictions for 2023
With market uncertainty on the minds of senior executives as we move into the new year, 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. According to ON consultants, embracing transformation in an uncertain landscape, continued digital transformation efforts, and building strong financial organizations are among the key factors expected to drive executive hiring in the coming year.

Organizations say IT and data (27 percent), engineering (22 percent), and sales and marketing (20 percent) skills are among the most sought-after technical skills they are looking for, with reliability and self-discipline (29 percent), resilience and adaptability (26 percent), critical thinking and analysis (26 percent), creativity and originality (26 percent), and reasoning and problem-solving (26 percent) the top-desired soft skills.

“Despite economic pressures, hiring outlooks remain resilient and employers across every industry continue to look for in-demand roles,” said Jonas Prising, chairman and CEO of ManpowerGroup. “At the same time, tight labor markets mean many face challenges finding people who have the soft and technical skills they need. Investment in upskilling, reskilling, and a focus on preparing people for tomorrow’s jobs has never been more important and should be at the top of every business leader’s agenda.”

Key Findings

Employers around the world continue to anticipate hiring more workers in the second quarter, reporting a seasonally adjusted net employment outlook of +23 percent which remains unchanged from Q1. Overall, the strongest hiring intentions are among organizations in Panama (+41 percent), Costa Rica (+38 percent) and Guatemala (+38 percent); with employers in Hungary (+ two percent), Greece (+ seven percent) and Poland (+ eight percent) reporting the least optimistic outlooks. Among the world’s largest economies, the U.S. (+30 percent), France (+26 percent), the U.K. (+21 percent), and Germany (+19 percent) all report positive hiring outlooks in the coming months.

Regionally, organizations in North America report the strongest hiring intentions (+30 percent), followed by South and Central Americas (+27 percent), and Asia-Pacific (+27 percent); while the weakest hiring intentions, although steady, are in Europe, Middle East, and Africa (+18 percent).

When compared with the previous quarter, outlooks improved in 22 countries, with the biggest quarter-over-quarter changes in Europe — particularly in the Czech Republic (+14 percent), Norway (+10 percent), and the Netherlands (+10 percent).

Employers in IT (+34 percent), communication services (+30 percent), and financials and real estate (+29 percent) report the most optimistic hiring outlooks, with those in healthcare and life sciences (+25 percent), industrials and materials (+21 percent), and consumer goods and services (+18 percent) reporting the lowest.

The ManpowerGroup report also found that nearly four in five (77 percent) of employers globally report difficulty finding the talent they need, rising two percent year-over-year and more than double the difficulty in 2015 (38 percent).

Employers in Asia-Pacific (82 percent) and North America (79 percent) report the biggest challenges filling roles, followed by Europe, Middle East and Africa (77 percent), and Central and South America (72 percent). Taiwan (90 percent), Germany (86 percent), and Hong Kong (85 percent) are among the countries facing the highest talent shortages.

Employers report the top five in-demand technical skills are IT and data, engineering, sales and marketing, operations and logistics, and customer facing and front office. The ManpowerGroup report also found that reliability and self-discipline, resilience and adaptability, critical thinking and analysis, creativity and originality, and reasoning and problem-solving are the top five in-demand soft skills.

Related: Talent Shortages Reach Highest Levels in 16 Years 

Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media

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