Webinar Insights: Pay Transparency, Gig Economy, and 2024 Job Trends

What’s Driving the 2024 Job Market? Key Trends to Watch

In Aura’s January webinar, we were once again joined by an expert panel as they examined the current job market and employment landscape. The panel included Evan Sohn, CEO of Aura; Jesse Tinsley, founder and CEO of JobMobz; Miles Jennings, founder and CEO of Recruiter.com; and Julia Pollak, Chief Economist at ZipRecruiter.

See some of the highlights from their discussion below.

Top Takeaways:

• Recruiters are optimistic about the job market – a sentiment echoed by the Recruiter Index.

• We're seeing recruiters juggling more roles, indicating a rising demand for talent.

• Overall candidate sentiment has been steady, but job applications are on the upswing.

• Job seekers are vocal about their need for remote work and work-life balance.

• The healthcare industry is buzzing, while IT jobs have taken a backseat for now.

• The JOLTS report shows fewer job openings than the 2019 average.

• Job hopping is at its lowest since 2018. Does this mean job satisfaction is on the rise?

• Wage growth for job switchers has slowed. Are companies focusing more on nurturing existing talent?

• Salary transparency is the new norm, with more states mandating pay disclosure in job postings.

• Consumer-facing industries could be bracing for layoffs due to tech advancements.

Recruiter Index Insights: Trends Shaping the Job Market

Miles Jennings highlighted the Recruiter Index, a monthly survey that gauges hiring interest and provides job market insights from recruiters and talent acquisition professionals. Here’s what he shared:

The sentiment analysis of recruiters' outlook on the job market revealed a positive trend. While historically low compared to the past two years, there was a noticeable increase in December. This indicates a slight boost in confidence among recruiters, even though the numbers are still lower than desired.

Another important statistic discussed was the average number of roles recruiters are working on, known as their "req load." This number experienced a significant increase, both in comparison to the previous year and within the context of last December. This surge suggests an optimistic upward trend in the number of job opportunities available, which is promising news for both recruiters and job seekers.

Candidate Sentiment & Priorities: What Recruiters Need to Know

Shifting the focus to candidate trends, the overall candidate sentiment remained relatively flat, with a slight decrease. However, a more interesting picture emerged when analyzing the number of applicants per job. Approximately 74% of recruiters reported an increase in the number of applicants, while 26% experienced a decline.

These early indicators of a slightly tighter job market could be seen as positive for recruiters, as it signifies high demand for job postings. Conversely, for job seekers, it may pose challenges in finding suitable opportunities. Understanding these trends and preferences of job seekers is crucial for recruiters to match candidates with the right job openings effectively.

Additionally, when recruiters were asked about job seekers' preferences, compensation, remote work, and work-life balance emerged as the top priorities. Hybrid roles were particularly popular, with 43% of recruiters reporting an increase in such roles compared to 41% for purely in-person roles. The data also showed that 16% of roles were fully remote. In terms of industries, healthcare was highlighted as one of the most in-demand sectors.

Aura's research also found that there was a decline in new remote job postings from November to December, with a decrease of 7%. Additionally, the proportion of remote jobs out of the total number of jobs decreased by 2%. Despite this trend, it's worth noting that remote work continues to be a sought-after preference among job seekers, with compensation, work-life balance, and hybrid roles being top priorities. In the healthcare industry, in particular, there is a significant demand for professionals.

Workforce Trends by Industry: Key Highlights from Aura

Evan Sohn noted that November 2023 marked the first time since 2019 that job openings fell below the yearly average. However, it's important to consider that November hiring tends to lag behind by 30 days. Notably, the quit rate was at its lowest, suggesting a potential slowdown in people leaving their jobs. This could be attributed to individuals quitting before the end of the year, possibly due to seasonal factors.

Looking at Aura data, Evan highlighted that job openings in the U.S. saw a slight increase. Particularly noteworthy was the rise of staffing and recruiting as the top industry with new job postings. This indicates that job postings can serve as a reliable indicator of future movement in the job market within the next 30 to 90 days.

IT & services, staffing & recruiting, and computer software emerged as the leading sectors, surpassing marketing & advertising in their demand for AI roles. This suggests a shifting focus in companies' strategies when it comes to AI-related positions.

The Rise of Gig Work and Flexible Hiring Models

There has been a noticeable trend of companies hiring contract-to-hire roles, which is a departure from traditional hiring practices. This shift allows employees to have more leverage and flexibility in their career choices, particularly in hiring software engineers. Additionally, salaries have stabilized on job postings, with the average pay no longer surpassing the associated costs. This change is attributed to companies resetting their expectations and aiming for more manageable and sustainable offers instead of the previous approach of rolling out the red carpet to attract scarce candidates.

Throughout 2022 and 2023, there has been a decrease in advertised pay, marking an unusual occurrence compared to previous years. This adjustment results from companies transitioning from an intense candidate-focused approach to a more balanced and normative negotiation process. By setting realistic expectations and allowing for more flexibility, businesses aim to create a space where both employers and candidates can find mutually beneficial agreements. This shift reflects a conscious effort to establish a sustainable framework for future hiring practices.

Jesse Tinsley highlights the increase in attrition among contract recruiters in the tech sector. Previously, there was virtually no attrition, but now there is a noticeable decline in offers. Companies are even considering contract-to-hire roles for software engineers, which is a new trend in the industry. This shift is seen across various customers and indicates a slow but steady change in the job market.

Overall, these changes in hiring strategies and salary expectations demonstrate a shift towards a more balanced and sustainable approach in the job market. Companies are focusing on creating opportunities that meet the needs of both employers and employees, allowing for greater flexibility and negotiation in the hiring process.

Pay Transparency Laws: Impact on Hiring and Salaries

Julia Pollack discussed the emerging trend of pay transparency in employment law. Certain states like Colorado now require employers to post salaries, leading to a significant increase in the number of job postings, including pay information. Previously, only around 20-30% of jobs disclosed pay, but after the transparency requirement, this percentage jumped to approximately 50 -60%. This shift has affected a large share of Americans, particularly in states like New York and California. Julia expects more states to adopt similar measures in the future, although the spread of this trend has been slower than anticipated.

However, this increase in pay transparency may be impacting the average salary figures. Previously, it was primarily companies that benefited from publishing pay information that did so voluntarily. Now, a wider range of companies are disclosing pay, potentially pulling the average salary down. Many companies are concerned that sharing pay information may make them less competitive, especially if their benefits outweigh their salary offerings. The challenge lies in effectively conveying this information to job seekers, as companies struggle to highlight their unique selling points when reduced to a single number in job postings.

The trend of pay transparency is gaining momentum, with more job postings, including salary information. However, its impact on competitiveness and conveying the full value of benefits remains a challenge for employers.

The job market is evolving, with trends like contract-to-hire roles and pay transparency shaping the future. Companies are striving for balance and sustainability, while employees are gaining more leverage and flexibility. This webinar explored the changing landscape, and thanks to the insights shared by these panelists, we have a better understanding of what’s coming down the pike in 2024.

Ready to learn more? Take a look at Aura’s Industry Hiring Trends for December 2023 to see exactly where these and keep an eye out for January’s report to see how these predictions are playing out.