May 2023 | JOLTS, jobs, and java: Our experts take on the latest labor reports

Watch this 15 minute real-time discussion on the March JOLTS report, the April jobs report, and other hot topics in talent today.

May 2023 | JOLTS, jobs, and java: Our experts take on the latest labor reports

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Watch this 15 minute real-time discussion on the March JOLTS report, the April jobs report, and other hot topics in talent today.

Grab a coffee and join us for 15 minutes of real-time insights on the March JOLTS report, the April jobs report, and more with our Chief Economist, Sania Khan, and our Senior Director of Product Marketing, Jason Cerrato.

Introduction 0:00
Our chief economist Sania Khan and our Senior Director of Product Marketing Jason Cerrato. will share real time insights on the jolts report, jobs report and other hot topics and talent today, grab a coffee, sit back and spend the next 20 minutes listening to what’s currently top of mind for business leaders. With that, I’ll hand it over to Jason Cerrato for some jolts jobs and Java.

Jason Cerrato 0:27
Hey, everybody, it’s Friday. It’s Cinco De Mayo. I have I have a coffee, Sania. Hopefully you have a coffee in hand. So now we both have our coffees, and we have our jobs report. What did we learn today?

Sania Khan 0:38
So interesting. Day, I guess, interesting morning. The April jobs report came out this morning, and it exceeded all expectations. So, we added 253,000 new jobs in the economy in April, the expectations were 185,000. So exceeded quite a bit. And the unemployment rate actually dropped to 3.4% 3.5%. So still a very strong labor market. However, they did make two revisions for the last two months. So that and a downward revision at that. So, we lost 149,000 jobs from the last two months lost meaning we had overestimated in the last two months.

Jason Cerrato 1:34
And we talked about that last time we met how all of these reports continued to be revised. And I think that speaks to just the changing nature of work. Right. We talked about that on our last call. So, you know, one of the things that I think about when I when I read the news is I get that feeling like you know, the best of times the worst of times and all of it at once. Right. So, what are some of the takeaways that you see from this report? Obviously, we beat some expectations. But it seems like there’s fewer job postings, the labor market is tight. But there’s some positive signs, a little bit of mixed signals. But what do you take away from this?

Sania Khan 2:09
So quite a bit of paradoxes. Specifically, if you want to look at the construction industry, I thought that was pretty interesting. We saw that there was a 3.8% growth in spending over the past year, according to the census bureau. They came out with that earlier in the week. And that was due to obviously the increase in interest rates, and therefore the increase in costs in construction. And then also, there’s the federal surge in funding from the chips Act and the newly starting construction of semiconductor plants. So, we’re seeing an increase in construction overall in the country. But then the jobs report showed today that there was only employment only grew by 15,000 jobs over the month, and wages experienced only a modest point 4% growth. So, although we’re seeing an increase in spending, and we’re seeing some growth, we’re also seeing the jolts data that came out earlier this week that saw there was a 62% increase in layoffs in the construction industry from February to March. So, it’s quite a paradox when you put all those different figures together.

Jason Cerrato 3:30
You know, I was reading an article in the Washington Post this morning that talked about how 75% of the workers who stopped working during the pandemic have returned to the workforce. But the challenge, and I think this is part of you know, the adjacent skills story that we talked about often is that the people that have returned haven’t necessarily returned to the same industry. So, you know, you mentioned how construction is coming back. That was one of the industries where people have returned. But there are other industries that have been hit really hard, where a lot of people that were working in those industries have gone into other areas I read this morning, hospitality, education and real estate have been hit really hard.

Sania Khan 4:07
Yeah, leisure and hospitality in particular, you saw that as hotels were kind of shut down during the pandemic, people still needed to work. So, they ended up switching jobs that actually ended up paying more. And so, what we saw in this report was actually were the leisure and hospitality sector, although it added a lot of jobs this past month, it’s still short by 402,000 jobs, from its pre pandemic levels. So yeah, there’s quite a big shift between where jobs are coming back and how people are switching industries. And, you know, that’s something that I also talked about in some of my other work where, as we, as we see tech layoffs, for example, and we see layoffs and banking. The suggestion is that there’s other injuries Trees that are still growing, and they’re still hiring. And so, it’s okay. It’s actually a wise decision to move over industries and take your skills to another sector.

Jason Cerrato 5:12
Maybe that’s why we’re feeling this depends on the industry, it depends on the geography, it depends on the timing, but you get a little bit of positive and negative at the same time. There also was there also a big story that came out this week, we heard there was a piece of research that was put out by the World Economic Forum that said that almost a quarter of the jobs will be disrupted via AI in the next five years, going as far as to say 83 million rolls may disappear, while 69 million rolls emerge as a result of AI leaving a gap of about 14 million. And we talk often about, you know, redesigning work for the future. And, you know, dealing with disruption. I know, in a former life when I was an industry analyst, and we were talking about kind of the predictions for AI, we were thinking that AI as much as it would disrupt things, it would also create more jobs than it would replace. But I think, you know, as the way these things work, there’s usually a lag before there’s an upswing, do you think that’s kind of what we’re headed in for the next few years? Yeah,

Sania Khan 6:13
I think industries are going to change and job functions are going to be impacted across industries, from Ai. So, if you think about it, like in marketing, for example, the top tech skills now are digital marketing, or Google Analytics, WordPress, Google AdWords, customer experience. And so, this is a big shift in what it was just a few years ago. And then if you look at HR, there’s other tools like Workday, Fieldglass, and social recruiting, that are changing and rising. And then if you look at sales, for example, there’s the cloud application IoT, AI, digital marketing, Sage CRM. So, as you can kind of see, it’s impacting all job functions, all industries. And I think there was even a report by Goldman Sachs that said, AI could raise GDP by 7%. So, some jobs might be declining, there’s going to be some new jobs that will be created. But overall, I think this is just the way this is the future of work and what we’re about to see come to fruition.

Jason Cerrato 7:28
And I think that’s why a lot of the meetings and conversations we’ve been having with HR leaders and talent leaders, you know, a lot of them are focused on shifting towards becoming a skills-based organization, because the skills mix is changing so fast, right? And the world of work is acting so dynamic, that you need to have kind of that view of skills to understand the talent you have, as you start to plan for the future. Even if you don’t know what those roles are going to be yet, right? You need to understand kind of your inventory of skills, the talent you have in house, as you try to figure out, Okay, here’s what we have, here’s what we’re investing in. Here’s what we’re developing, how does that align to the future as it unveils itself. That reminds me, there was another article that got a lot of attention this week, and it was saying how IBM was currently evaluating how work will be done in the future for the organization. And they were currently pausing hiring for about 7800 jobs, they currently had listed as open, because they were evaluating if they could be done using AI in the near future. I think that caught a lot of attention. But I think that speaks to this, maybe calm before the storm are that kind of time to review before you actually act. Understanding the disruption. I know, you’ve published some things on chat GPT and generative AI and the future of work, kind of what are your thoughts on this?

Sania Khan 8:49
Yeah, I think you’re absolutely correct. You know, there’s going to be new roles that are going to be created within this ecosystem of AI. Like, for example, I think about when iOS came out for Apple, there were new apps, and there were gaming companies that started to be developed. And now it’s a whole new industry. So, a new technology, a disruptor, almost in the technology in this in that industry comes, comes at out and now you see some jobs that are lost, but then a whole new industry that’s kind of created. So, I think we’re going to see new companies that will see what the pain points are of today and solve for those. And then I think there’s also going to be existing roles that will have to embrace the new technology and have to incorporate it into their thinking and in order to compete with the industry but not just their industry out across industries really. They’ll have to incorporate it into their thinking and their daily work.

Jason Cerrato 9:55
Now there’s been a lot of buzzwords and terms thrown around in the last Few years as HR leaders have been facing this reality, and we’ve heard about the great resignation and the great reshuffle. And then there was quiet hiring and loud layoffs. Right? A new one I heard this week, you know, we when we think about the word restructuring, we often think about restructuring in organizations. But when we talk about kind of designing work for the future, and all of this movement, potentially across industries into new areas, I heard the phrase restructuring of the labor force. It’s got to be, it’s gotta be so much to think about, especially for a labor economist like yourself.

Sania Khan 10:34
Yeah, it’s an exciting time to be a labor economist, for sure. I think, yeah, just these new AI based tools will need to be leveraged by people in their day-to-day functions in order to stay competitive. And if you if you take, for example, a product manager, right, they’ll need to think about how generative AI, they’ll need to incorporate that when developing a new product. So not only how can the AI be leveraged during development, but even as an engineer, how do you develop new products around these tools? So, it’s, it’s really gets into the nitty gritty of how can you use the new technology in your work? But then also, how do you use the new technology in your software, for example, that you’re developing. So, it’s going to be an interesting time for sure to see these changes.

Jason Cerrato 11:31
Now, you know, when people think about disruption, and especially as of late, everyone turns to generative AI, and especially, you know, chat, GPT. But for some of the meetings and forums that, you know, have occurred since the last time we met, there’s also been some discussion around green initiatives leading to job growth, that as the world faces, kind of the future of the environment and environmental factors, not only are we creating new industries and new jobs around green initiatives, but skills around kind of environmental factors, and the greening of work will formulate in maybe nontraditional, you know, green jobs, what are you? What are you hearing about that?

Sania Khan 12:15
Yeah, it looks like there’s going to be quite a few green jobs, growth in the labor market. So, and right now we’re look, seeing that we don’t have the sufficient human capital to meet those goals, and to meet those climate targets. And so, we, we have an opportunity here to rethink not only how does the green jobs industry change for the future, to address these problems, but how do your skills of the workforce and how do you attract people outside that haven’t worked in the green economy? Obviously, because it’s new and emerging? And how do you get them to upskill and rescale them into these new jobs. So, I think that’s going to be an exciting time to see that come to play.

Jason Cerrato 13:06
And when we talk about kind of this restructuring of the labor force, like these things will not just surface in the environmental businesses, or the energy industry, or the gas and chemical industry, these are going to surface in what are traditional corporate roles, especially as organizations take on more and more ESG initiatives. Right? So, think about redesigning work, changing the skill mix, right, looking at how you’re going to do your job in the future. Not only is it the disruption of AI, but it’s also kind of the consideration of these green initiatives.

Sania Khan 13:39
Yeah, great point. I think any firm that’s engaged in innovation and, and, and any part of ESG will need to take these skills into consideration and their workforce.

Jason Cerrato 13:55
So, it’s been a very busy Friday morning already. We had a robust jobs report, a lot of things to think about. I know, I always enjoy having a having a cup of coffee and catching up with you when these reports come out. We are heading into Eightfold’s Cultivate conference next week, where we will be meeting with organizational leaders from various industries around the world. And I’m sure many of these topics will be discussed, not only during the agenda, but as everyone’s networking and work together, trying to understand how we’re going to design future the future of work and apply these new technologies to all of our challenges that we’re facing. I think one of the things that that we’ve realized is, as we’ve gone around and met with HR leaders and met with organizational business leaders, no matter where they are in the world, they’re all having these same discussions and facing the same challenges.

Sania Khan 14:46
It’s really true. I think, everyone kind of realizes that we saw there was a difficulty in hiring over the past few years post pandemic and it was really difficult to get the right people in the right jobs. And so I see HR leaders almost staying away from layoffs as much as they can. But what does that really mean? You have to restructure your jobs in ways to fill the needs of the future and to stay competitive and innovative across industries and within your industry as well. And so I think it’ll be a good time for this conference. I think there’ll be some really cool, interesting sessions there. So excited and looking forward to that one.

Jason Cerrato 15:34
So we got to pack our bags and head on over to cultivate. see everyone next week, and we’ll continue the conversation there. But for now, I think that wraps up our our jobs, jobs and jobs, jobs report for today. Back to you, Kelly.

Kelly 15:50
Thank you so much for joining us today. And thank you to Sania and Jason for sharing your insights. We hope you’ll join us on June 2 For the next jobs talk with eightfold AI. Until next time.

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