There’s hope ahead. LaborIQ® forecasts economic acceleration in the back half of next year
DALLAS–(BUSINESS WIRE)–ThinkWhy, a SaaS company helping businesses navigate the labor market, released its national jobs report following an announcement from the Bureau of Labor Statistics that the economy added 245,000 jobs in November, with the unemployment rate at 6.7 percent.
Even with this morning’s report of 245,000 jobs added for November, the rise in virus counts and colder weather indicate a continued slow pace of recovery through early 2021. During the pandemic, many industries have seen job growth level off, as the cold weather restricts consumer behavior and certain types of employment. Until a vaccine is widely available, the speed of the recovery will remain slow and uneven.
“The first vaccine recipients — frontline medical workers and nursing home residents — are unlikely to change their behavior all that much as a result of being vaccinated,” said Marianne Wanamaker, labor economist and ThinkWhy executive advisory board member. “But the second tranche of vaccinations, older Americans and those with pre-existing conditions, are high-propensity spenders. These are the people who have largely stayed at home since March. Freeing up this group to spend and be active in the economy again will likely be a huge boom to consumer spending and business activity. That vaccine-induced spending should have positive job implications, hopefully by Q2 2021.”
Looking to the future, the U.S. still has 9.8 million jobs to recover from their levels before the pandemic, and LaborIQ® by ThinkWhy projects that jobs will not be fully recouped until early 2023. The biggest storylines to watch through early 2021 are:
- Timing, efficacy, and number of people who will get a vaccine
- Impacts to industries and locations based on tightening social restrictions to contain the virus
- Stimulus to keep businesses and consumers afloat
Why It Matters: Key Business Impact
While we continue to see economic activity toward recovery, until a vaccine significantly lowers the virus’s impact, there will likely be some bumpy months of growth ahead, whether in certain industries, geographies or for the whole nation. Still, the expectation of a strong rebound on the other side of COVID-19 is the baseline. Until then, look for certain industries to remain much stronger than others.
With a changing administration in Washington D.C., keep an eye out for the details of additional fiscal stimulus, as this will drive consumer spending. Recruitment for the following types of businesses will likely remain more robust than for others through early 2021:
- Finance and insurance
- Home delivery services
- Grocery stores
- Computer equipment
- Housing construction
- Scientific research and development
Talent acquisition professionals will have their hands full next year filling jobs, especially in hot hiring markets. LaborIQ reports the following locations are hot markets for hiring, after enjoying the nation’s highest job-growth rates in October:
- Virginia Beach, VA
- Raleigh, NC
- Los Angeles, CA
- Memphis, TN
- San Jose, CA
- Indianapolis, IN
- Dallas-Ft. Worth, TX
- Birmingham, AL
- Austin, TX
- Charlotte, NC
INDUSTRY RECOVERY TRACKER
LaborIQ® forecasts the labor market to be back to pre-pandemic level by the first half of 2023. Several industries are poised to recover faster, while a few others could lag the 2023 timeframe by up to two years. This projection is based on moderate job growth during this year’s fall and winter seasons, followed by stronger, more sustainable job growth beginning in mid-2021.
“Winter will be challenging for the struggling travel and restaurant industries, as a rise in COVID-19 leads to more restrictions. Imminent vaccine availability shines a ray of hope for a major economic rebound in 2021; however, businesses relying on social contact may go months before seeing a major lift in employment. LaborIQ® by ThinkWhy expects it will take more than four years for these industries to recover,” stated Jay Denton, Chief Innovation Officer and SVP of Business Intelligence for ThinkWhy.
Recruiters and corporate talent acquisition professionals should prepare for robust hiring next year at companies providing Professional and Business Services in big cities throughout the U.S., from New York and Boston in the east to Detroit and Chicago in the heartland to San Francisco and Los Angeles on the West Coast.
Economists at LaborIQ® by ThinkWhy forecast that the Professional and Business Services industry should be primed for acceleration in 2021 as the promise of vaccines portends a stronger recovery on the horizon.
Other industries expected to return to pre-pandemic employment levels:
2022: Construction, Financial Activities, Healthcare and Professional and Business Services
2023: Manufacturing and Trade, Transportation and Utilities
2024: Government and Mining and Logging
2025: Leisure and Hospitality
To read the full report, click here.
About LaborIQ by ThinkWhy
LaborIQ® by ThinkWhy is a breakthrough technology providing talent acquisition professionals with data-driven solutions to grow their bottom line.
Our talent tech helps win candidates – and clients – with the most precise market analysis and salary answers for over 20,000 job titles, across all U.S. cities and industries. LaborIQ’s employment reporting and forecasts, talent supply and demand, compensation benchmarking, and custom reporting tools deliver a competitive advantage in talent acquisition.
Learn more at www.ThinkWhy.com or follow us on Twitter and Instagram at @ThinkWhy_, on Facebook at @ThinkWhyLLC and LinkedIn at @ThinkWhy-LLC.
KWT Global for ThinkWhy