Evidence of a U.S. worker shortage is popping up from “help wanted” signs in store windows to the record number of Americans — 4.4 million — who quit their jobs in September. Employers are finding that the traditional ways of attracting new employees, like raising pay, aren’t necessarily effective.
The one thing that’s more enticing to workers than anything else is remote work, said the chief executive of one of the nation’s largest job postings sites. And increasingly, job seekers are getting what they want. But Ian Siegel, co-founder and CEO of ZipRecruiter, told Yahoo Finance Live that it’s been a challenging process for employers.
“Previously, we had hypothesized that all of these workers were reluctant to return to work because they were scared of getting sick, or they didn’t have child care or they were getting stimulus checks, or they didn’t have to pay their mortgages. Literally every one of the reasons that we had been talking about is gone now,” Siegel said.
But workers still aren’t coming back. In addition to that record number who quit their jobs two months ago, there are still a near record 10.4 million open positions. Although hiring has picked up, with 531,000 workers added to U.S. payrolls in October, the nation’s civilian labor force is still 3 million workers shy of its pre-pandemic level. That’s not to mention economists’ estimates from earlier this year that the economy would be adding jobs at a 1 million monthly rate by now. The labor force participation rate is holding near its lowest level since 1977.
“The response from employers has been to effectively roll out the red carpet to these job seekers,” Siegel said. “They’re pulling out every stop they can think of. They’re raising wages. They’re offering an increased number of jobs with benefits. They’re offering flexible schedules. They’re literally offering entry-level job seekers the opportunity to go to college and have it paid for.”
“And yet the job-seekers still aren’t coming,” he added.
The secret sauce, the magic ingredient, the one offering that has been the most attractive to prospective employees — the option of working remotely.
“During the pandemic, people discovered a new, more satisfying way to live. It’s the number one perk that employers are offering on ZipRecruiter,” said Siegel. “Two years ago, less than 2% of jobs mentioned remote work. Now more than 10% of jobs mention remote work. Those companies that are offering remote opportunities are experiencing the most success in recruiting.”
Siegel expects the market to normalize in about 12 months. The people choosing not to work are living off of savings, which will eventually run out. (The U.S. personal savings rate fell to a post-pandemic low of 7.5% in September, the most recent month for which data was available).
And not every job can be accomplished remotely. In fact, Siegel said, about 60% of jobs nationwide require employees to work in person.
These dynamics have been good for workers and good for ZipRecruiter, which recently reported its third-quarter sales more than doubled.
“It truly is a golden age to be a job seeker,” Siegel said. “You have never seen employers fighting so hard for your attention.”
Julie Hyman is the co-anchor of Yahoo Finance Live, weekdays 9am-11am ET. Follow her on Twitter @juleshyman, and read her other stories.
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