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April to see best job growth since August as the recovery continues, but that could be hampered by a shortage of available workers.
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U.S. job growth surged in April as widely available vaccines and stimulus money fueled business confidence, recruiters and industry experts told MNI, though a significant labor shortage threatens to slow the market's recovery.
After months of practicing some caution in hiring, employers in April were "just optimistic," said Tom Gimbel, president and CEO of the LaSalle Network, with caution "out the window."
"People are very bullish about the next 18 months," he added, driven by widespread vaccine availability for U.S. adults and stimulus from the government that has injected more certainty into the economy.
Gimbel said his recruiting business was up more than 50% in April from a year earlier, at the trough of pandemic job loss, and new job orders through the month were up more than 40%.
"It's not just existing clients that are growing, we also have more new clients coming to us than ever before," he said, as many employers struggle to find available workers.
HIGHER WAGES NEEDED
Employers through April were hard-pressed to find people willing to work for minimum wage, he said, which could put upward pressure on hourly wages.
"Pre-pandemic pay rates are a thing of the past," said Yvonne Rockwell, who owns a recruiting business in Santa Clarita, Calif. "Employers are getting very competitive in how they're attracting talent. They're having to pay more, offer better benefits, and be very mindful of their company culture."
Rockwell said available workers, particularly skilled workers, are "like unicorns" in the labor market. "They're hard to find."
That's giving workers more bargaining power, and many job seekers are fielding multiple job offers. "It's absolutely an employee driven market," she said.
Rockwell said demand for office support roles increased through the month, signaling a return to the office for some after more than a year of remote work. "We're seeing that receptionists are going back to the lobbies," she said. "A lot of those remote workers are coming back into the offices."
Hiring in industries like aerospace was also elevated through April compared to previous months, Rockwell said, suggesting demand for air travel is returning.
Employer demand for workers in tourism, hospitality, and foodservice industries grew markedly in April, Nick Bunker, an economist at online job marketplace Indeed, told MNI, as restrictions on business were eased.
"Some types of jobs that have been really affected by the pandemic have started to pick up at a pretty healthy clip over the past month or so," he said. Overall job postings on Indeed were up 20% over pre-pandemic levels during the reference week for the Bureau of Labor Statistics' monthly jobs report, he said.
Still, hiring in leisure and hospitality "could have been even stronger" if the labor pool was larger, ISM survey chair Anthony Nieves told MNI, and many workers are still sitting out until more of the population is vaccinated and it's "safe to go back" to work.
Total nonfarm payrolls are expected to grow by 1 million in April, according to the Bloomberg consensus, the largest monthly increase since August, though not too far above March's stronger-than-expected 916,000 gain. There is some potential for an upside surprise, with forecasts on the upper end of the spectrum calling for an increase of more than 2 million jobs.
The unemployment rate should tick down two-tenths to 5.8%, according to Bloomberg, while hourly wages should stay flat.