But the change in that figure is primarily a result of firms deciding they don’t need to fill as many roles, and not because of a surge in unemployment.
“Businesses are just not laying off [many] workers,” said Mark Zandi, chief economist at Moody’s Analytics financial services group, in an interview with NBC News.
Instead, he said, they are cutting back on hiring, hours and temporary work.
“There’s still underlying job growth,” Zandi said.
On balance, the U.S. economy remains on firm ground. Federal Reserve officials continue to say there remains uncertainty about how much longer the rapid price growth that’s bedeviled consumers since the onset of the pandemic will linger.
A slower pace of job growth, economists say, should slow those rates of inflation.
“This could be good news for the Federal Reserve as the overall pace of employment in April was more consistent with its 2% inflation target,” said Fred Ashton, director of competition policy at the American Action Forum, a center-right think tank.
One follow-on effect from the current conditions: Fewer people who are already employed are seeking opportunities elsewhere. The BLS also reported this week that the rate of workers quitting has now held steady for six months, even as it is down significantly from its post-pandemic high.
It’s a sign that the “Great Resignation,” which saw workers taking up new roles in droves — usually at higher pay levels as businesses reopened during the pandemic — is mostly behind us, replaced instead by the “Great Stay.”
But as long as outright layoffs remain subdued, Zandi said, “The economy can create a couple hundred thousand jobs a month.”
A slowing labor market also means lower wage growth, a negative development for employees, but a sign that overall inflation will likely cool further.
“After the volatility and disruption associated with the pandemic, the supply and demand of labor is coming into better balance,” said Mark Hamrick, senior economic analyst at Bankrate, in an emailed statement.
Robust hiring for lower-earning workers
While all economic sectors are seeing labor market slowdowns, some are still seeing elevated levels of job growth. Leisure and hospitality, which includes recreation, accommodation, and food-services roles, has maintained the highest hiring rate, BLS data show.
Professional and business services, a catch-all category that includes both higher- and lower-paying jobs, were the next highest.
Further insight comes from a data series created by Vanguard financial services group, which shows hiring for middle- and high-income workers having slowed to a crawl, while lower-income workers continue to be hired at a healthy clip.
“We’re certainly seeing, within firms, that the hire rate among more costly or higher-paid workers has been going down,” said Fiona Grieg, global head of investor research and policy at Vanguard, in an interview.
While they still earn less on a relative basis, lower-paid workers are now making more than they were prior to the pandemic. Hiring forums show McDonald’s now pays its hourly workers as much as $13 an hour, compared with as little as $10 hourly prior to the pandemic. While the inflationary environment has dented the spending power of some of that increase, hourly workers’ pay has been climbing faster than that of salaried workers.
Some consolation for higher-paid workers may be found in LinkedIn data, which shows that although hiring rates are still down 10% year-on-year, that figure represented an improvement over trends seen for much of 2023.
“The labor market is gradually stabilizing,” LinkedIn chief economist Karin Kimbrough wrote in April.
Applicant ranks swell
But stabilization does not mean strength. LinkedIn told NBC News the number of job applications per applicant increased by 14% from November 2023 to March 2024. Over the same period, it said, there had been a 25% increase in the number of LinkedIn members in the U.S. who had added its “open to work” photo frame to their profiles, indicating they are actively searching for a job.
“If you’re a high-wage worker right now and you’re sitting on the sidelines, the job search may take some time,” Vanguard’s Grieg said.
Social media platforms are now filled with stories from unemployed workers stating they’ve unsuccessfully applied to hundreds of jobs.
Tre Gripper, 32, posted to X this week to say that since being laid off in June 2023, he had unsuccessfully applied to approximately 463 roles.
“It’s demoralizing,” Gripper said in a follow-up interview with NBC News. “I’ve worked really hard in my field and to keep not getting anything — there’s only so much I can continue to do without going into a completely different field.”
Currently a resident of Houston, Gripper has supported himself in part thanks to a generous transition bonus and severance package he received from his previous employer.
But those resources have since been depleted, he said. Now, Gripper and his husband are planning to move to Seattle for both of their careers. And since his X post, which now links to his LinkedIn profile, went viral — racking up more than 12 million views — he’s seen a surge in opportunities.
His takeaway: Applying to an open call for an online job posting may now be the least effective way to land a role.
“Unless someone is pushing you through, recruiters aren’t even seeing your application,” he said.