ManpowerGroup Inc. Chief Commercial Officer Becky Frankiewicz joins Yahoo Finance Live to discuss the resilience of the U.S. labor market, especially amid the July jobs report.
JOE BIDEN: Today, we also matched the lowest unemployment rate in America in the last 50 years, 3.5%. Yes, 3.5%. Today, there are more people working in America than before the pandemic began.
SEANA SMITH: That was President Biden on matching the lowest unemployment rate in America in the last 50 years. Jobs growth picking up steam in July, the US adding 528,000 jobs last month. The labor force participation rate declining, ticking down to 62.1%.
Let's bring in Becky Frankiewicz, chief commercial officer and North America president at ManpowerGroup. Becky, it's great to see you. Let's start with that labor force participation because it peaked in March, has fallen pretty continuously since then, despite tons and tons of job openings. What do you think is happening here?
BECKY FRANKIEWICZ: Yeah, this American workforce is an economy that just won't quit. I mean, all of the economic indicators are signaling caution, and yet, American employers and employees are signaling confidence. And it's really this balance, Seana, between a tug of war with risk and resilience that we're seeing play out in front of us. And so the workforce participation, it dropped a little bit. But what's really interesting about that is it dropped even in the face of increasing wages, which, again, usually don't move at that opposite direction.
DAVE BRIGGS: What are we seeing in wage growth? And if could just button up on the participation rate, how problematic is it moving forward?
BECKY FRANKIEWICZ: Yeah, it's a significant concern. And so if you ask me what was the one lowlight of this morning's report, it is the workforce participation. Now, a highlight there was the fact that more women came back into the workforce, which we know we lost disproportionately during the pandemic. But yet again, another low light is we've lost adult men in terms of their participation. Workforce participation is critical for economic growth. And so it is one of the things that concern me about this morning's report.
SEANA SMITH: And Becky, when we talk about burnout across the labor market, mental health concerns, people out sick up 60% above those pre-pandemic monthly averages, how are employers-- just speaking with a number-- to a number of employers, how are employers managing this? And I guess how is it affecting hiring plans?
BECKY FRANKIEWICZ: Yes, so ManpowerGroup, we just completed some research with Thrive Research around what's happening with burnout, what are the things that employers can do to help assist with burnout. We have actionable research that you can log into and explore on your own. But one of the key takeaways is conduct an entry interview.
So we often talk about the exit interview, but conduct an entry interview with new employees to say what works for you personally, and what works for you professionally, and where can we have some common ground. Burnout is real. Again, with workforce participation going down, it puts more pressure on the existing employee base that's already strained.
DAVE BRIGGS: Probably some crossover between burnout and this question-- where are the biggest job openings?
BECKY FRANKIEWICZ: Yeah, so healthcare continues to be one of the most in-demand sectors in our economy. So registered nurses is number one in terms of demand. Number two continues to be truck drivers. So even with this mixed shift that we're seeing play out between services and goods towards services, we're still seeing truck driver demand continue to increase.
And then in the third position and holding in the top five, month over month now are software developers. And so all the headlines around IT layoffs, those are real, but guess what? IT unemployment went from 1.8% in June to 1.7% in July. So it dropped, meaning the economy absorbed all those technically skilled individuals.
DAVE BRIGGS: The nurses and truck drivers, those openings, is that, in part, because of burnout? Do you have data showing that?
BECKY FRANKIEWICZ: Yeah, so what we have data showing is, candidly, across the sectors of the economy, we are short staffed. We can't find the workers or the skills that we need to fuel the economy. And so, yes, it's, in part, due to burnout. And I think it's, in part, causing burnout. So it has a two-pronged effect.
SEANA SMITH: Becky, what about education, teachers? We're heading into a new school year. We've talked time and time again about the fact that there simply is not enough teachers nationwide. How big of an issue is this? And I guess any plan here in order to close that gap? Because we're approaching a very critical time.
BECKY FRANKIEWICZ: Yes, we are, and back to school is critical. We are seeing, again, women come back into the workforce. Women disproportionately represent employment in education, so that's a positive. The other thing we're seeing at the same time, though, is still shortages. And so for the first time in maybe decades-- I don't know-- we're seeing bonuses for, like, temporary teachers or substitute teachers. People asking parents, can you please come in and volunteer as a substitute teacher?
And so there's some good to that. It gets the community involved. The challenge is the child doesn't get served day in and day out with the quality of teacher that they need and that we expect.
DAVE BRIGGS: Crucial problem. Leisure and hospitality led the way, 96,000 jobs created, but still a million below the pre-pandemic level. Does the current number-- is it just a new norm?
BECKY FRANKIEWICZ: Yeah, so the good news is people are traveling, spending their money on experiences, getting out of their homes. And I heard it referred to as revenge travel against COVID. So that, I think, is a positive. The challenge-- and you see it in the headlines-- we just don't have enough workers in hospitality and leisure. Many who were displaced during the pandemic went into other service industries or other industries and haven't come back into that industry. And so we're still short staffed. And to your point, we're still well behind the entry point into the crisis.
SEANA SMITH: Becky, who's calling the shots right now? As we talk about these fears of a recession, the potential slowdown that we could see, is that ball back in the court of the employer? Or does the employee still have the upper hand?
BECKY FRANKIEWICZ: Yeah, the empowered American worker is still calling the shots. And, you know, I've heard a lot about the report this morning that it's a couple of weeks behind. That is true, but today, we celebrate the resilience of the American economy, the dedication of the American worker. And right now today, the American worker is still calling the shots in our economy.
DAVE BRIGGS: All right, Becky Frankiewicz, really appreciate you being here. Great numbers, great analysis. Have a good weekend.