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Are you a professional working in the US? Or are you planning to start a career in the US? Well, if the answer is yes, this article may be the right place for you to see what’s happening in the US job market. Like any other job market around the world, the United States witnessed some real losses due to the pandemic. Let’s start with some 2020 highlights.
- Unemployment claims in early April were approximately 6 times higher than the previous high in 1982.
- The job losses in April were 10 times higher than the previous peak in 1945.
- The unemployment rate reached 14.7%, which was the highest ever since the Great Depression in the 1930s.
- Sectors like tourism and travel, arts and architecture, and hospitality were completely damaged.
- Massive job losses in industries like construction and mining.
- Slowed down operations in the tech, finance, and other professional services sectors.
Fast forward to one year, a lot has changed. With vaccines rolling out and COVID precautions in place, many workplaces have opened up for day-to-day operations. Based on the most recent report by Bloomberg, 531,000 new workers were added to the US market in October 2021, decreasing the unemployment rate by 4.6%.
Increased number of freelancers
The obvious decrease in the demand for labor in 2020 led to a decrease in the supply of labor in 2021. Losing jobs led people to look for alternatives, giving rise to the freelance revolution. While platforms like Upwork, Fiverr, and Freelancer were used before the pandemic hit, they grew at an expedited rate in 2020. This increased the current number of freelancers to 57 million in the US. According to a survey by Upwork, 20% of the current workforce (about 10 million) is still considering moving to freelancing permanently. This clearly states that freelancing is here to stay and will only continue to grow. Some reasons why it is preferred by professionals are:
- It gives control over your workload
- It provides flexibility to work
- It can be an additional source of income for many
- It gives an option to work with a variety of clients
Expected rise in the number of immigrant workers
By 2021, the Trump government was expected to have reduced legal immigration by almost 50%. While the job market was already suffering, reduced foreign workers added more challenges to the hiring process. According to a report by the Washington Post, the US has 10 million job openings but only 8.4 million active job seekers. The impact has been unwavering in every industry, from seasonal jobs in the agricultural sector to high-paying tech jobs.
However, with the change in the government, things are expected to change for the better for immigrant workers in the last quarter of 2021. Additionally, the re-opening of borders will also be a good opportunity to inject immigrant workers back into the US workforce. Furthermore, some universities have decided to waive off the GRE requirements from their graduate admission process. This will motivate more international students to apply for educational programs, resulting in an increase in immigrant workers in the coming years.
More white females returning to the workforce
The beginning of the last quarter of 2021 also witnessed changes in the workforce based on gender. There was an increase in the number of women returning to the workforce while the percentage of men was comparatively lower. Additionally, data showed more White and Hispanic females returned to work, whereas the number of Black women declined. According to the Labor Department’s chief economist, it took almost up to 2018 for the employment situation to improve for Black women in the US, which was again severely impacted in 2020.
One of the prime reasons for White women to rejoin the workforce is said to be the opening up of schools. This has allowed women to get back to work while their children go back to school. Finding childcare has been considered a long-term problem for Black women. Among other reasons, this could be one of the reasons many of them didn’t come back into the labor market. The chief economist also states that 552,000 Black women left the labor force and didn’t return. Had all of them sought employment actively, their current unemployment rate would have been 13.4% instead of 8.7%. Also, many Black workers chose to work from home while not returning to their White-dominated offices. They believe working from home is more comfortable for them where they don’t have to answer unnecessary questions about their looks.
COVID-19 also gave rise to location-independent hiring for many companies. The number of companies hiring through LinkedIn for remote roles in the US increased from less than 2% in May 2020 to about 10% in May 2021. While remote work has made lives easier for many professionals giving them more control of their work-life, it has vastly benefitted employers too. It has given them the option to hire workers from anywhere around the globe, reducing costs. Studies have shown that professionals are happier and more satisfied working remotely than on-site. Thus, this has also enhanced the retention rates.
In the coming months, one should expect an increased rate of remote hiring. If you are an on-site worker and are enticed by remote working, this may be a good time for you to try your hand at it. We can suggest two ways to get started.
a) Look for freelance roles along with your full-time job. This will give you a better idea of how the freelancing industry works. Additionally, you will have time to try out different options before deciding what works for you. Some websites that you can use to look for freelancing roles are:
b) Start applying for remote roles. As mentioned earlier, many companies have now started to advertise a higher number of remote roles. Based on your interests and preferences, you can identify the most relevant jobs and make applications. Some websites that you can use to identify remote positions are:
Higher number of retirees
The pandemic pushed many professionals, especially older ones, into early retirement. According to research by Pew Research Centre, about 50% of the US adults aged more than 55 years retired from the labor force. Exactly 2 years ago, it was approximately 48%. The ‘life-is-short’ attitude is being quoted as one of the reasons for early retirement in the US. However, experts are yet to ascertain if the enhancing retirement rate is permanent or is set to reduce in the coming months.
Some other aspects of the labor market that can help you make informed decisions are:
a) Not all industries have recovered uniformly. Some witnessed an increase in employment, while a few others offered fewer opportunities this year as well. Local and state government education industries saw a reduction in employment while industries like information and private education witnessed little to no changes. Sectors that experienced increased employment include:
- Leisure and hospitality
- Professional and business services
- Transportation and warehousing
- Retail trade
- Financial services
- Mining and employment
b) To attract more candidates, some employers increased the hourly pay rate for workers by 4.9% from a year earlier, from $29.52 to $30.96.
c) Some top employers to look out for employment are:
- CISCO Systems
- Spot X
- The Washington Post
d) September 2021 also marked the end of unemployment benefits provided by the US government to the unemployed population.
Overall, the US employment market has started recovering in many aspects. While there are many still impacted by the pandemic, the unemployment rate has gone down. The market is showing positive signs of growth for the coming months. If you are looking to re/enter the US job market, this may be a good time for you.