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Employers are 'trying to woo' candidates back to the office: CareerBuilder CEO

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The U.S. added 850,000 jobs in June. CareerBuilder CEO Irina Novoselsky joins Yahoo Finance Live to discuss.

Video Transcript

AKIKO FUJITA: Well, the positive economic data we got this morning weighed down by challenges to the labor supply that Emily just pointed to and the increased expectations of higher wages. More than half of US companies expects to raise the minimum wage to attract workers. That's at least according to CareerBuilder.

Let's bring in the CEO of CareerBuilder. We've got Irina Novoselsky joining us this morning. And Irina, give me a sense of what you are seeing in terms of the supply in the market, the supply-demand dynamics, and how that's really dictating the terms for some of these job openings. We've heard so much about higher wages, as well as signing bonuses, in some cases, trying to attract workers.

IRINA NOVOSELSKY: It's a really interesting time in the market. And just what you heard, we have 50% more supply. And so you would think this is such a great time for companies to come in and be able to hire talent. And we're seeing 30% job growth. However, on the other side, we're 25% down on job seekers looking and applying for jobs in pre-pandemic numbers. And it's so interesting because we're seeing the dynamics of this play out in the market, where companies are offering incentives, benefits, trying to woo candidates back into the market.

AKIKO FUJITA: And Irina, we did hear from President Biden a short time ago reacting to the better than expected job numbers. I want you to listen to what he had to say and then get your reaction on the other end.

JOE BIDEN: The last time the economy grew at this rate was in 1984, and Ronald Reagan was telling us it's morning in America.

AKIKO FUJITA: So President Biden there saying, essentially, look, the momentum is headed in the right direction. But I wonder if you walk through the numbers that we got this morning, what are the weak spots that you see? And are there reasons for maybe some concern here, some red flags that you see, in terms of how sustainable this is, especially with the shortage in supply?

IRINA NOVOSELSKY: And on the sustainability of the job growth, we're continuing to see companies post. But when you look even at the NFIB index, one of the things that they mention is that there's a 46% open rate of businesses not being able to fill open jobs. And that's a 48-year high. We're seeing that really only continue with about 11% increase of the population retiring than pre-COVID. We're seeing about 7% not participating increase, 7% increase in the population that are staying out of the workforce due to child care and elderly care.

And one of the most interesting things is we're just seeing double digit sentiment on the census poll survey, saying that people are just not looking for work right now. And that's a combination of things. And that's going to drive wages up. That's going to put more pressure on companies to provide out services. Many of us have been on the consumer side of this, waiting in lines, seeing a lot of signs, saying, we're hiring, excuse the slow response time. So that's going to continue. And one of the interesting things we looked at is, is it different now that some of the states have stopped their extended unemployment benefits?

ZACK GUZMAN: When it comes to maybe how much power workers have now or what they're expecting when it comes to wages, I mean, what are you seeing on that front at CareerBuilder? Because it sounds like the expectations are mounting for workers who have gone back into the office or to work since the pandemic hit.

IRINA NOVOSELSKY: Zack, it's both the expectations and the competition from our clients. They're wanting to retain existing employees. The quit rate on existing employees is growing and higher than we've seen in several years. And so they're looking at different things. And we mentioned that 50% of companies are looking to increase their minimum wage. 56% of those are looking to increase it above $15. When you look overall, about 1/3 of existing employees are looking and expecting over a 5% wage increase this year. So the pressure from both the hiring market and retaining your existing employee base is continuing to grow.

AKIKO FUJITA: And Irina, while we saw the gains really focused in sort of leisure and hospitality, we've also had a lot of guests on from the services side who have said that, look, one of the challenges we're seeing is, yes, we're having a hard time filling the positions. And we think there is something that is much more fundamental in terms of the changes that have happened beyond wages. That they don't think some of these workers are actually coming back to the services sector because there are other options out there that allow more flexibility and that pay better. Have you seen that shift? What are you seeing when you compare it to where things stood pre-pandemic?

IRINA NOVOSELSKY: Definitely. When you look at just the retail sector, to what you said, Akiko, there's about a 50% quit rate within that space. So 50% more increase in quitting. And a lot of that is going to skills. They're thinking about the skills that they have. And we spent a lot of time at CareerBuilder advocating for this. But how do you take your skills and transfer it into other careers and jobs that more align with what you're looking for, whether it's benefits, it's location, wages. It could be just the type of industry or company you want to work with. And so we're seeing a lot of that pivot out from waitstaff and hospitality into mortgage application securities, customer service representatives, into other sometimes mid-office, back office roles that are giving employees a little bit more flexibility, especially with work-from-home optionality.

AKIKO FUJITA: Certainly interesting to be tracking some of those shifts there. Irina, good to have you make sense of the numbers for us. Irina Novoselsky, CEO of CareerBuilder.