Job Growth Moderation Likely, but Wage Pressure To Remain Elevated

Staffing Industry Analysts (03/07/22)

On the heels of last Friday’s jobs report, The Conference Board Employment Trends Index indicates more robust job growth lies ahead, although at a slower pace. However, hiring and retention will continue to pose challenges.

“So far in 2022, more than 1 million jobs have been gained,” said Frank Steemers, senior economist at The Conference Board. “However, some moderation in job growth is likely in the months ahead — we are now further into the recovery and economic growth rates are projected to decelerate compared to an especially strong 2021. Still, with the labor market being short 2.1 million jobs, returning to pre-pandemic employment levels is likely in 2022.”

But even with the job growth ahead, The Conference Board noted issues will continue over hiring and retention.

“The unemployment rate has already dropped below 4% and is expected to approach 3% by the end of 2022,” Steemers said. “In such a tight labor market, wage growth will likely remain elevated. In particular, workers in in-person services, such as restaurants, personal care and hotels, are now benefitting from a tight labor market.”

The Employment Trends Index rose to a reading of 119.18 in February from the upwardly revised reading of 118.15 in January.

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