5 hiring statistics you need to know for 2021

Smartt Principles

Nicole Smartt Serres is an author and president of Star Staffing, based in Petaluma.

See past installments of her column: nbbj.news/smarttprinciples

The pandemic changed the way we work and will continue to do so for years to come.

With extended unemployment offerings and increased weekly benefits, healthcare subsidies, and stimulus checks, the job market has drastically shifted from being employer-driven labor market to a candidate-driven one.

Ever since 2020, the job market is tightening and the number of employee resignations, also known as voluntary separations, is rising year-over-year. Workers have been job hopping in hopes of attaining better pay and career mobility.

According to IBM’s Institute for Business Value, 1 in 4 workers plan to switch jobs this year. Of the 1 in 5 workers who switched jobs last year, 33% identified as Gen Z and 25% as millennial.

Compensation is steadily rising.

However, winning the war for talent requires a deep understanding of what employees really want. Employers of all sizes are beginning to realize pay increases are not the only levers they can pull to attract and retain employees. Often, customized benefits and compensation strategies reduce operating expenses and, at the same time, better cater to employees’ physical, emotional, career and financial well-being.

Want to get a leg up during this challenging time for employers?

Here are five hiring statistics you need to know for 2021 and beyond.

1. Hiring will continue to be challenging.

President Biden extended the $300-extra-per-week benefit through September, thus making an average California weekly paycheck $604 on unemployment.

That is a pay rate of $15.10 an hour for those that are currently on unemployment. When you factor in transportation, lunches and child care costs, you are looking at needing to pay an even higher pay rate to be competitive.

2. Job search activity rose in states that announced they will prematurely end federal unemployment insurance benefits.

About two dozen states have announced they would prematurely end the enhanced federal unemployment benefits (UI). These benefits include the $300 weekly on top of standard state UI, as well as other extensions and expansions.

3. Top 3 reasons workforce are not returning in volumes.

We touched on federal aid, which is the largest factor, followed by child care, and COVID-19. Only 60% of the largest U.S. school districts were fully open in April, leaving some without childcare.

And, even with accelerating vaccinations, people are still fearful of getting COVID.

4. Companies are boosting wages to compete.

Amazon is now paying new hires an average starting wage of $17 an hour, which is up from their original rate of $15 an hour. It are also offering a $1,000 signing bonus for new hires.

Chipotle is bumping up its average pay for restaurant workers to $15 an hour and says that employees can earn $100,000 annually after three years.

Meanwhile, McDonald’s is raising wages for 36,000 workers. Uber and Lyft are combating the driver shortages by offering large bonuses to get people driving again. Walmart raised its average hourly wage to $15 an hour.

5. There are more jobs than available workforce.

We are in a labor shortage, and most anecdotes of this labor shortage are coming from employers in leisure and hospitality. The industry saw the biggest gains in April.

According to CNBC, many workers are reconsidering the types of jobs they are now looking for, such as ones with better pay or more flexibility, roles that use different skill sets; or openings in industries that are more stable.

The hiring dilemma is impacting every employer whether you are a small or a large company.

A recent Robinhood Snacks Digestible Financial News shared possible outcomes to this dilemma. It could help workers and the economy through rising wages, as real wage growth has been sluggish for decades.

Or it could become an economic dilemma. Wage growth could be canceled out by weaker purchasing power if prices continue to spike. Rising prices especially hurt low-income households.

The labor shortage could also slow economic growth. Workers will return as benefits expire and schools reopen — but business may find it hard to lower wages, which result in downsizing their operations and decreasing productivity.

Smartt Principles

Nicole Smartt Serres is an author and president of Star Staffing, based in Petaluma.

See past installments of her column: nbbj.news/smarttprinciples

Show Comment