The Labor Department’s January jobs report showed the U.S. added 517,000 jobs last month as the unemployment rate reached a five-decade low—signaling the economy, and job market in particular, remains strong despite growing layoffs among technology firms that splurged on labor during the pandemic.
2022 saw major companies announce layoffs with a majority coming from the tech sector, amounting to a total of 152,000 total job losses across 1,000 tech companies.
Despite the layoffs, the January jobs report shows a significant increase in other sectors such as leisure and hospitality, which accounted for 128,000 added jobs last month.
Other sectors seeing growth in jobs include government, healthcare, retail trade, professional and business services, construction, transportation and warehousing and manufacturing according to the report.
A survey by ZipRecruiter, an online employment marketplace, shows U.S. workers still have bargaining power in the labor market.
The survey notes workers are finding jobs quickly with 54% of recent hires finding jobs within a month and 34% finding a job in 1-3 months.
It also notes the hiring process has been significantly streamlined as half of respondents say they heard back from prospective employers in 1-3 days and 90% heard back within about a week, despite standard industry hiring practices waiting 1-3 weeks to get back to applicants after reviewing job applications.
Another ZipRecruiter report shows that despite tech layoffs, tech workers can find new jobs relatively quickly compared to other industries and branch out to other sectors including government, e-commerce, healthcare and some take advantage to build their own business after being laid off.
While tech layoffs have been making headlines, it’s important to note major tech companies added new workers at a substantial rate during an ambitious hiring spree during the pandemic.
Since the pandemic, Microsoft hired 77,000 jobs, Google added 67,880 jobs and Amazon saw previous job growth of 746,000 compared to layoff numbers of 10,000, 12,000 and 18,000 respectively.
In March, the Federal Reserve started raising interest rates in order to combat high levels of inflation by making debt more expensive and thereby slowing down the economy. As rates climbed, the stock market tanked, and many companies started announcing job cuts. Particularly hard-hit companies have included those in rate-sensitive sectors like technology and housing. However, the broader economy remains relatively strong, with consumer spending starting to slip but still holding up, and jobless claims remaining near historic lows.
“The labor market is pretty strong,” Elise Gould, senior economist at the left-leaning nonprofit Economic Policy Institute, told NBC News. “The unemployment rate is low, and there are still people who have not returned to the labor market after the pandemic, so we can expect the labor force can grow. But we’ve had an incredible couple of years of recovery.” she added.
Various companies across different industries are looking to hire new workers in 2023. The U.S. Postal Service is looking to hire 2,400 employees in California. Fast food chain Chipotle is looking to add 15,000 new members in preparation for what it calls “burrito season” (the company’s busiest period, from March to May). Bloomberg LP is looking to hire 1,000 new workers despite other media outlets cutting jobs. Car manufacturer General Motors is looking to add 8,000 tech jobs to its workforce following major tech layoffs.
