Unprecedented Demand: Record Number of Americans Flock to Job Market in Search of New Opportunities
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Looking for work? Join the club.
Looking for work? Join the club.
The share of U.S. workers who are on the job hunt has reached the highest level in over a decade, according to the Federal Reserve Bank of New York. New labor market data released Monday show that over 28% of respondents said they were actively looking for a job in July. That’s the highest reading since the question was first asked in March 2014, when just under 32% said the same.
Economists say more people looking for work tends to be positive overall. But that’s not always true for the workers themselves.
Economic Insight
“It depends on if that person is employed or unemployed,” said Sofia Baig, an economist at Morning Consult, during the firm’s State of the Economy briefing last week. “It’s not a good thing when there are people who are unemployed and can’t find a job.”
Labor Market Overview
The unusually high job-search reading comes after a surprise uptick in the unemployment rate to 4.3% in July. Rising unemployment sparked a major market sell-off earlier this month and spurred some notable economists to call for an emergency rate cut from the Federal Reserve.
The Fed has been holding benchmark interest rates at a two-decade high in its war against inflation. Higher interest rates can cool an overheated economy by making it more expensive to borrow money. When it’s more expensive to borrow money, people often spend less. As a result, employers may eventually hire less — or even cut their workforce.
But layoffs aren’t the only reason people are itching to find a job. The NY Fed’s data show that compared to last July, workers are increasingly dissatisfied with their pay, benefits and prospects for a promotion. That’s causing many of them to look for a better gig.
Do recent layoffs signal a recession?
Headlines this summer have been dominated by big-ticket layoffs across several industries.
In July alone, Disney, Intuit, John Deere, the dating-app company Match and the media company NerdWallet all announced layoffs, affecting nearly 3,000 workers total. More cuts came in August, with Axios, General Motors, Intel, Paramount and carmaker Stellantis collectively slashing about 7,500 jobs.
Perspective on Recession Odds
However, some experts, including Claudia Sahm, creator of the “Sahm Rule” that predicts a recession when the unemployment rate rises 0.5% from its previous 12-month low, are tempering the news of recent job cuts by pointing to the relative health of the job market and economy overall.
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