With our feet firmly placed in 2021, US businesses have begun to adjust to the tempo of the year. We are now able to analyze how the US staffing industry has responded to Q1 in its attempt to recover from the ongoing effects of the pandemic.
After facing hiring freezes, remote working conditions and rises in unemployment in 2020, we explore how the current state of the US staffing industry compares to previous months and years.
Employment levels
Unemployment
Recent data from the BLS shows that levels of unemployment are improving as the number edged down to 6% in April 2021, equating to 9.7 million unemployed people. Whilst this is a steady improvement from the earlier stages of the pandemic, it is still 2.5% higher than the pre-pandemic levels in February 2020.
From February to March 2021, the number of people classifying themselves as permanent job losers declined by 65,000. Again, this is still 2.1million higher than the pre-pandemic levels, but shows steady improvement on a month to month basis.
Surprisingly, professional staffing in March 2021 was up 36% year on year, and up 26% compared to normal working conditions two years ago. The data suggests that this growth is linked to the growing demand for professionals across the healthcare sector.
Research also showed that women are worse hit by unemployment levels. This is likely due to the fact that women account for the majority of workers in the sectors that were the hardest hit, such as hospitality, leisure and education.
Temporary staffing
As the nation went into lockdown in March 2020, this resulted in a significant number of temporary job losses. A year later, the country is showing strong progress with an increase of 28% in temporary staffing.
In particular, the same article shows temporary staffing in health, finance, engineering and IT were up 36% year on year. It is no surprise that these sectors have experienced increased demand for temporary workers; the US healthcare system is attempting to claw back the backlog of elected surgeries; businesses have a greater need to pay attention to the organisation and management of their finances; engineering projects are remobilising after project cancellations and delays; and IT professionals continue to be in demand largely due to the ongoing implementation of remote working initiatives.
Similarly, temporary hours in commercial occupations, such as industrial and clerical work, were up 24% year on year.
These statistics show strong signs of recovery for temporary workers in these sectors, although still below the pre-pandemic levels.
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Growth by sectors
Overall, hiring has shown steady growth across several sectors, with the April jobs report showing 13 of 15 major industry groups increasing in jobs from February to March 2021. Interestingly, hospitality and leisure saw the biggest gain as they added 280,000 jobs. This is significant since these industries saw the largest decline during the pandemic across all major industries, due to the prolonged closure of the hospitality industry. Although hospitality and leisure are still down 15% year on year, this monthly increase is a promising sign of strength and recovery. Following hospitality and leisure, government and construction had the second largest gain in jobs in March 2021.
What is also interesting to note is that sections of IT staffing were up double digits in March 2021 compared to two years ago. This comes as companies worldwide continue their search for better IT and tech, and IT leaders continue to hire as they innovate in tandem with the rising demands.
Closing remarks
After a year of uncertainty, shock and survival, the US is beginning to relay old foundations. With companies adapting to new ways of working and markets reopening, unemployment rates are beginning to steadily decline, and businesses are opening up their doors to new hires. Although there is still a way to go before the US staffing industry returns to its former glory, the recent increase in jobs and employment levels is a hopeful indicator of strength. It appears the end is in sight and the 2021 market has shifted from a space of survival to a period of planning for the future.
IMS People Possible provide offshore/outsourcing services for US staffing agencies. To discuss how we can support your business, contact us here.
