Unemployment Rate Falls to 4.6 Percent

New labor report shows the market's recovery accelerating through the fall as the Delta wave eased further. Veteran search consultant Gary Erickson of Executive Search Partners sits down with Hunt Scanlon to discuss current trends in the market.

November 5, 2021 – Employment rose by 531,000 in October as the U.S. unemployment rate fell to 4.6 percent, according to the most recent U.S. Bureau of Labor Statistics report. So far this year, monthly job growth has averaged 586,000. Job growth was widespread, with notable job gains in leisure and hospitality, in professional and business services, in manufacturing, and in transportation and warehousing. Employment in public education declined over the month.

Among the major worker groups, the unemployment rate for adult men (4.3 percent) declined in October. The jobless rates for adult women (4.4 percent), teenagers (11.9 percent), Whites (4.0 percent), Blacks (7.9 percent), Asians (4.2 percent), and Hispanics (5.9 percent) showed little or no change over the month.

“After the labor market’s recovery stalled in recent months, today’s numbers suggest positive job growth as hiring scales up across major industries,” said Mike Smith, global CEO of Randstad Sourceright. “While hiring is improving, talent scarcity continues to slow companies as workers voluntarily leave their jobs at record rates and pace.”

“Tapping into contingent talent as well as adopting hybrid or remote work arrangements can serve as a lifeline for companies struggling to hire, as well as provide existing employees with more flexibility,” said Mr. Smith. “In today’s job market, workers feel empowered to find positions that will offer them higher wages, improved benefits, a better work-life balance and purpose. Employers need to adapt their recruitment strategy in accordance with the new expectations of jobseekers.”

Where Job Growth Occurred

• Employment in leisure and hospitality increased by 164,000 in October and has risen by 2.4 million thus far in 2021. Over the month, employment rose by 119,000 in food services and drinking places and by 23,000 in accommodation. Employment in leisure and hospitality is down by 1.4 million, or 8.2 percent, since February 2020.

• Professional and business services added 100,000 jobs in October, including a gain of 41,000 in temporary help services. Employment continued to rise in management and technical consulting services (+14,000), other professional and technical services (+9,000), scientific research and development services (+6,000), and legal services (+5,000). Employment in professional and business services is 215,000 below its level in February 2020.

• Employment in manufacturing increased by 60,000 in October, led by a gain in motor vehicles and parts (+28,000). Employment also rose in fabricated metal products (+6,000), chemicals (+6,000), and printing and related support activities (+4,000). Manufacturing employment is down by 270,000 since February 2020.

• Employment in transportation and warehousing increased by 54,000 in October and is 149,000 above its February 2020 level. In October, job gains occurred in warehousing and storage (+20,000), transit and ground passenger transportation (+16,000), air transportation (+9,000), and truck transportation (+8,000). Employment in couriers and messengers decreased by 5,000 in October, after increasing in the prior three months.

• Construction employment rose by 44,000 in October, following an increase of 30,000 in September. In October, employment increased in nonresidential specialty trade contractors (+19,000) and in heavy and civil engineering construction (+12,000). Construction employment is 150,000 below its February 2020 level.

• Healthcare added 37,000 jobs in October, with most of the gain occurring in home healthcare services (+16,000) and nursing care facilities (+12,000). Employment in healthcare is down by 460,000 since February 2020.

• In October, employment in retail trade rose by 35,000. Employment gains occurred in food and beverage stores (+16,000), general merchandise stores (+15,000), health and personal care stores (+8,000), and electronics and appliance stores (+6,000). These gains were partially offset by a job loss in building material and garden supply stores (-10,000). Retail trade employment is 140,000 lower than its level in February 2020. Employment in the other services industry increased by 33,000 in October, as personal and laundry services added 28,000 jobs. Employment in other services is 169,000 below its February 2020 level.

• Employment in financial activities rose by 21,000 in October and has returned to its February 2020 level. Over the month, job growth occurred in real estate and rental and leasing (+12,000) and in securities, commodity contracts, and investments (+11,000).

• Employment in wholesale trade increased by 14,000 in October, reflecting a gain in the durable goods component. Employment in wholesale trade is 158,000 lower than in February 2020.

• Mining employment continued to trend up in October (+5,000) but is down by 87,000 from a peak in January 2019.  In October, employment decreased in local government education and state government education (-43,000 and -22,000, respectively). Employment changed little in private education (+17,000). Recent employment changes in public and private education are challenging to interpret, as pandemic-related staffing fluctuations have distorted the normal seasonal hiring and layoff patterns. Since February 2020, employment is down by 370,000 in local government education, by 205,000 in state government education, and by 148,000 in private education.

• Employment in information changed little in October (+10,000) but is 122,000 lower than in February 2020.

Veteran Recruiter Weighs In

Gary Erickson is managing partner of Executive Search Partners. He has over 30 years of management and executive experience including the positions of CIO, COO, director of sales, and global director quality and manufacturing. In 1994, Mr. Erickson was named one of the country’s leading mid-market CIOs by Deloitte and Touche.

Mr. Erickson recently sat down with Hunt Scanlon Media to discuss the pandemic, hiring, and how his firm has adjusted to working with clients and candidates during the post-pandemic era. Following are excerpts from that discussion.

Gary Erickson

Gary, many are optimistic about a return to normalcy by the end of the year. What are your thoughts about the recovery? 

We are seeing an increased level of hiring activity and all of our clients are optimistic about the economy and hoping the pandemic will come to an end soon. But none of them think that it will be over until sometime in the middle of next year. This date keeps getting pushed out as the U.S. struggles with getting enough people vaccinated so that the reinfection rate drops below one. Almost all of our clients are still working remotely and are finding that they can operate well with a remote model. Most are trying to determine how much in-office time they will require in the future, and some have already committed to a long term fully remote model.

“We are seeing an increased level of hiring activity and all of our clients are optimistic about the economy and hoping the pandemic will come to an end soon. But none of them think that it will be over until sometime in the middle of next year.”

What are some of the challenges you’re seeing right now

The continuing uncertainty around the end of the pandemic and thus the continuing need for working remotely has affected recruiting for current open positions. Our clients are trying to decide if their positions could be fully remote long term or should they require candidates to come into the office at least part time sometime in the future? Add to this that many candidates prefer remote vs. in the office work. This decision is affecting recruiting strategies (should we recruit nationwide?) and salaries (probably higher than historically) and thus pay equity across the organization.

Has your firm adjusted in how it serves clients? 

Most recruiting firms have had to adjust to a remote model for customer interaction and for recruiting. Some have had to adjust to a nationwide model for recruiting since more and more companies are accepting full time remote candidates from anywhere in the U.S. Executive Search Partners has not needed to adjust our model since we have always worked remotely and we have 19 years of experience in sourcing candidates both locally and nationally.

Related: Skills Gap Points to Why We Need to Invest in People

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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