Last year, the US job market saw tremendous growth in job opportunities while witnessing the lowest unemployment rate. As reported by Glassdoor, 76% of hiring managers have stated their biggest hurdle has been attracting top talent during recruitment. This doesn’t come as a surprise since the US unemployment rate in 2018 was at its lowest in almost five decades, according to the US Bureau of Labor Statistics.
We believe this trend will maintain the momentum in 2019 as well. This means that businesses will encounter an even larger challenge when it comes to hiring best talent. In contrast to the earlier job market, the job seekers of present time are in commanding position, i.e., they are choosing their preferred employer, not the other way round.
So, what are the next big upcoming workplace disruptions? Glassdoor’s 2019 Job Market Trends Report discusses five critical job trends (some of which are already in play) and workforce disruptions that are going to have huge impact in the way companies attract, hire, and retain talent.
This article will summarize the list of the top five employment trends that made a mark in 2018 and the upcoming disruption for 2019.
Data-driven job matching will be the norm in recruitment
Job matching has come a long way since the pre-internet era — from finding jobs on newspaper and sending resume to prospective employers to job aggregation and application via keyword search. However, the real disruption will be around the job matching via predictive recommendation engines driven by machine learning.
This stems from the fact that the job aggregator sites are not simply into collecting job listings from thousands of companies, they are employer review sites, networking platform with humongous amounts of data on people, skill, companies and jobs. By leveraging the availability of such data it would be quite natural for the recommendation engines to learn from job listings’ skill requirement and the job seekers skills, personality and previous experiences to curate small set of job opportunities with higher level of accuracy in terms of matching.
This is going to be win-win solution for both job seekers and employers, as it can make corporate recruiters much more productive via machine learning models to scour through the database for a list of best-fitting candidates. Apart from that it improves the job search experience of prospective employees by helping them focus on a small list of jobs that can give higher probability of final job offer along with culture-fit. These two factors will be combined to provide the right talent which would be result in better employee engagement and retention.
AI will be augmenting workers’ skills
Last year, there were swarm of articles debating the future of work in the post-AI era in which automation will be quite normal. According to Glassdoor, AI-driven automation of routine tasks will actually help the ‘knowledge-workers’ employed in service industry (tech, consulting, finance, etc.) who use data, software and intellectual skills to do their job.
Also, in practical sense the present job roles in various business functions comprise of complex set of tasks — some of which can be automated while the others need human judgement. Hence, it understandable when experts say that automation will help workers become productive while taking care of repetitive tasks.
Now, the question arises: who’s currently hiring AI talent. According to the data provided by Glassdoor, major tech companies like Microsoft, Amazon, and NVIDIA are investing heavily in AI. But, we also see that diverse set of industries starting from media and healthcare to finance and marketing have joined the AI bandwagon.
Given below is the chart that shows top US and UK employers hiring AI talent:
The report emphasizes that in case of AI, the job roles are not limited to only tech jobs such as software engineering or data science — many companies are hiring non tech workers like product manager, sales manager, strategy consultant, copywriter. This brings us to our next topic in which we discuss the growing demand for non-tech workers.
The expanding tech industry will be hiring more non-tech talent
During the early phase of tech industry engineers, and technology architects built the infrastructure for the company’s software solutions. As the tech industry matures, businesses would inevitably need sales and marketing talent to build the revenue pipeline from the company’s technology. Similarly operations teams hire more as tech companies expand and set up new shops in various locations. Even software engineers require HR teams to manage benefits, payroll and personnel issues.
This trend is already shaping up in present time, as 43 percent of all open jobs at tech employers on Glassdoor were for non-technical roles. Here is the chart depicting open non-tech jobs in various companies and the percentage of non-tech jobs:
Important point to note from the report – non-tech hiring tends to rise with revenue, while tech roles often grow more slowly. This is because of the fact that the technology platform can scale with user growth, but user acquisition and revenue scale happen with the growth in the number of sales personnel.
Aging population will lead to shortage in talent pool
Today majority of the employers are plagued with labor shortage. Glassdoor’s report suggests that one of the most influential trends arriving in 2019 and beyond is demographic changes, i.e., slowdown in working-age Americans. This could lead to tight labor markets for several upcoming decades. The report says many present demographic trends are indicating towards aging, more slowly growing, and less work-focused American population. Similar to how a small tide can transform to tsunami, these underlying demographic transformation will have far-reaching impacts on jobs, salary and recruitment.
Here is the chart based on OECD data that shows the work-hour has been shrinking globally and the US is no different.
The first wave of Baby Boomers touched the retirement age of 65 in 2011 and millions more will follow the suit in the next few decades. That’s both reducing the nation’s pool of experienced workers and changing the age profile of American consumers. A falling birth rate, which reached a 30-year low last year, is one more cause that would result in shrinking labor force. The rising demand from American consumers coupled with low growth in working-age population would put employers in a difficult path.
The looming economic slowdown
Companies in the U.S. have continuously added jobs for 99 months, the longest increment on record since the 1930s. However, fissures are the emerging the economy — the Federal Reserve is increasing interest rates, increasing the cost of mortgages on regular basis. The housing market is slowing and the 10 to 15 percent of the economy driven by trade is getting alarmed by the tariffs. The riskiness of corporate debt is increasing, with a record $3 trillion in low-grade corporate bonds today. The “yield curve” — the relationship between Treasury bond yields and maturity dates — is close to reversing its usual upward slope, a phenomenon that has generally been a good indicator of nearing recession.
Another risk to watch is the dampening housing market. The Federal Reserve had increased interest rates three times in 2018. That has led to higher mortgage rates, resulting in gigantic increment in the cost of housing making it out of reach for the majority of Americans. The final result is slowing housing market — a major risk since housing is a huge industry and the main source of wealth for most Americans.
Although there are many economic risks on the horizon, by most studies today the odds of a recession in 2019 remain low and the economy overall is strong and healthy. According to Glassdoor – “As per the a November survey of economists by Reuters, the median odds of a recession in the next 12 months has held steady at about 15 percent for the past year. Even over the next two years, the odds of recession according to that survey are about 35 percent — still very low.”