At Glassdoor, I spend my time trying to make sense of the labor market through research, primarily with our own data. In 2016 I learned a lot about hiring challenges facing both the recruiter and job seeker, about how the labor market has fluctuated, and what folks can expect going into the new year. As we close our books for 2016, let’s examine how things went, and see what this means for the year to come.
A Remarkable Year for Hiring
With significant gains, the economy turned a corner this year and continues to be strong and healthy. Unemployment is at its lowest since 2007, and we are in the longest streak on record for positive job gains.
- 1.98 million new jobs in first 11 months of 2016
- 74 consecutive months of job growth
So pat yourselves on the back. Every new you role you filled in 2016 contributed to today’s historically strong job market.
Hiring is Tougher Than Ever
This tight labor market makes it tough for employers to hire. As of April, the economy set a new all-time record of 5.85 million unfilled job openings, the most since the BLS started collecting surveys of open jobs in 2000. The ratio of unemployed Americans to open jobs is 1.4 to 1, down sharply from July 2009 when that ratio was 6.6 to 1. With fewer unemployed people looking for jobs, sourcing is simply harder.
If you met your 2016 hiring goals, you deserve congratulations for doing it in an extremely competitive market. If you didn’t, these extraordinary circumstances may help explain why.
Explosion of Tech Roles Across Industries
An increasing number of traditional employers need to hire what have been typically considered tech roles — data scientists, software engineers, mobile developers, etc. Our technology-driven lifestyles mean that more employers in finance, retail, healthcare, etc., need employees who can derive insights from data, create a mobile app, or code a website. A tight overall hiring market and increased demand for tech talent makes recruiting those coding and analytics stars even more difficult.
Big Push for Pay Transparency
Transparency in the workplace isn’t new, but in 2016 we saw a big push from policymakers for employers be more transparent about pay. New rules from the federal government will require some employers to disclose workers’ pay by gender, race/ethnicity; and the SEC has new rules that will require disclosure of the ratio between CEO pay and median worker pay.
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Right Fee, Right Hire: Are you getting the best talent?
Increased attention on pay transparency and pay equity means job seekers and employees will come armed with information to job interviews and performance reviews. In 2017, employers should prepare for increased salary negotiations.
Finally Seeing Gains in Americans’ Paychecks
Despite significant and robust job gains across the U.S., wage growth has been fairly slow to catch up. But, some good news in late 2016 shows wages are on the right track to continue to rise for the U.S. workforce. Glassdoor’s own salary data show a 3.1 percent year-over-year growth — the fastest pace in three years. As you prepare for the year ahead, make sure offers and raises are in line with current salary trends.