Jobs report: 'There are some bright spots,' strategist explains
Kelly Outsourcing and Consulting Group President Tammy Browning joins Yahoo Finance Live to discuss the job market in light of the December jobs report.
Video Transcript
- We will turn our attention back to the markets now and that jobs report and bring in our next guest. Tammy Browning is the president of the Outsourcing and Consulting Group at Kelly. Thank you so much for your time today. Tammy, just first your reaction to the jobs report. Did it surprise you compared to the big number that we got from the ADP result just a couple of days earlier?
TAMMY BROWNING: It actually didn't. While it there is some concern as you look at the report and you think to yourself, wow, we are not seeing the expectations that we thought we would, but really from a reality perspective, when you think about it, we are seeing what we thought we would see in this job report. It is exactly as we had predicted in that we would see, of course, some spikes.
There are some bright spots that I want to talk about I think that are really important. While the numbers may seem low, there are some really good opportunities, that we're seeing more women re-entering the workforce across all sectors. We are seeing the other populations of workforce, meaning men and other generations, jumping back in again. So we are seeing some bright spots in the report. But overall, as we thought it would be, somewhat disappointing, for sure.
- And then I want to ask you, as far as unemployment came in at 3.9%, we haven't seen that handle since before the pandemic. But then we also saw in the JOLTS report a record 4.5 million people are leaving their jobs or changing jobs. What do you think happens to the Great Resignation this year? What happens to labor movements?
TAMMY BROWNING: Yeah, I mean, it's here, right? We've been talking about this Great Resignation. There was this notion that perhaps it was just maybe a term that wasn't reality. But the fact of the matter is it's here. We're seeing it. Obviously, last month's report showed that in a big way. We are seeing that continue.
And, in fact, our own job reports, if I can cite just a few data points around it, is we can see our applicant flow is down 15%, yet the demand is up 30% from where it was prepandemic. And then when you consider the fact that the participation rates are sub 62%, it really does lend itself to the fact that this great resignation and people leaving the workforce is going to create a dynamic where employers are going to have to be much more creative in the ways by which they're hiring. And employees are taking advantage, frankly, of their opportunities, which is just about a 5% wage inflation rate.
It's also driving up the cultural dynamics, that perhaps they're unhappy with in their current environment, creating that flexible work environment that we've seen so many employers adopt and create, that work-from-home strategy. So that Great Resignation, frankly, the talent is saying we want something slightly different. They're taking advantage of the market as it is today.
- And then Tammy, this report came out. And it takes into account jobs data up until the middle of December. It was really after that that we felt the real impact of Omicron, with restaurants closing and then airlines impacted as well. What impact does Omicron have at least short term in what we see in the jobs market, let's say, going forward into January and February as well?
TAMMY BROWNING: Yeah, you hit it on the head. December was just a short month. Employers are experiencing it. In fact, as we look even, if you spin the attention to just what happened in this week with schools returning to work, over 4,500 schools went to some type of either distant learning or perhaps closed the school for a window of time. And so what we're seeing with that is that, in fact, it will have a greater impact in January. We're in this constant state of flux with respect to the pandemic and how it's infecting our overall work and how people are showing up.
The good news is, though, in our Kelly education practice, when I really look across the board. We're seeing that schools, in fact, do want to keep our kids working. Employers want-- or keep them learning, keep them in school, keep them healthy and safe, and keep them very much in classroom.
And we're seeing employers do the same thing. They're still looking at allowing flexible work environments, still allowing people to work from home, creating those environments where people can still, in fact, do their jobs in a remote way. So while I do think it will have an impact, I don't think that we'll see it majorly impact our overall job market. And I do think probably if you think about the fact that the jobs reports have been adjusted the last several months, and, in fact, are slightly more positive than they were in the reports, I do think we're going to see some more of a positive impact to the job reports going forward.
- And Tammy, also want to touch on hourly earnings. They increased by 0.6%, more than anticipated, more than the 0.4%. So I want to ask you, what is the strength of the worker as we move forward? What sort of wage power do they have?
TAMMY BROWNING: They do. It is an employee-driven market right now. The employees have the opportunity to demand what it is that they feel their value is, what their worth is. And, in fact, it's at their fingertips. Our employees today, the working population, they are more educated today about their value and their worth than they have ever been.
And there are many organizations, particularly that mid-market-size employer, that are taking advantage of that. If you think of the Great Resignation, individuals are leaving to go work in organizations that are going to pay them their value. And they're really going and willing to work for those smaller to mid-sized companies that are willing to really show up at that wage rate.
I anticipate that we're going to see this rise. It did rise a little bit greater than we thought in this last month or two. I anticipate it will go up between 1% and 2% almost every month until the summer. So we are in this point where the employees can actually drive their own career destiny.
- Yeah, and how much can they steer their own ship, if you will? What are the demands that you see anecdotally that people are asking for when they're starting a new job or looking?
TAMMY BROWNING: Yeah, they're really asking for it. It's fascinating, because they want to often what the cultural dynamic is. They want to understand what their resume-building power is. They want to know, am I going to take a job that is going to enhance my career, create skill sets that perhaps I don't have today?
And they also want that flexibility. We talked about that already. We've been talking about it for several months around creating that environment where if, in fact, they choose to work in a remote way, they have the opportunity to do that, but if they want to come in, that the employer is able to accommodate a face-to-face environment as well.
They're looking for perks. It's a lot of big perks. What can you give them that is not just pay rate, that is not just their ability to have flexibility, but are there other areas for you to focus on, whether that's sign-on bonuses, retention bonuses, perhaps membership fees paid for, things that give them the opportunity to say, this is an employer I'm willing to stick with for the long haul. And it's building my resume at the same time.
- OK, Tammy Browning, thank you for that insight, president of the Outsourcing and Consulting Group at Kelley.
