LinkedIn economist: 3 ways the pandemic has dramatically changed the labor market
Opinion by Karin Kimbrough for CNN Business Perspectives
Entering year three of the pandemic, the labor market today looks markedly different from when we entered this crisis. At LinkedIn, my team of data scientists and economists has a unique view into how ways of working have shifted — through the lens of over 180 million US workers and over 97,000 US companies using our platform, where one person gets a job every 15 seconds.
With a record 4.5 million Americans quitting in November alone, many have taken to calling this period of immense change the Great Resignation. But we prefer the term “Great Reshuffle,” which more accurately characterizes the major shifts across all aspects of work that go beyond just quit rates. Americans are rethinking their relationship with work, and workers, in particular, have much higher expectations from employers than ever before.
To paint a clearer picture of what’s happening, we looked across our US workforce data to identify the three biggest changes in how we work, where we work and why we work worth watching this year. Here’s what we found:
How we work: Remote work is highly attractive
In March 2020, only one in every 67 paid US jobs posted on LinkedIn offered remote work. By the start of 2022, that number ballooned to about one in six. Remote jobs punch above their weight when it come to applications, attracting over 2.5 times the share of job applications compared to on-site jobs, according to LinkedIn’s Great Reshuffle Report. Even with return-to-office timelines still shifting around, workers’ interest in remote and hybrid options shows no signs of slowing.
And according to LinkedIn survey data, 87% of employees would prefer to stay remote at least half of the time, even after it’s safe to return to their workplace. In an increasingly competitive hiring landscape, employers in many sectors are having to recalibrate their policies and approach to keep pace with this surge of interest in remote and flexible work.
Where we work: Workers are moving into new roles more quickly
While the latest government data show the number of Americans quitting their jobs is skyrocketing, especially among many frontline industries, LinkedIn data shows hiring rates are also highly elevated — meaning most workers are not quitting to drop out of the workforce, but are reshuffling into new and oftentimes better opportunities.
By the end of 2021, the share of LinkedIn’s US members changing jobs rose by 37% compared to 2020, and by more than 32% compared to 2019, according to new data from LinkedIn’s Great Reshuffle Report. And according to our Workforce Report, November 2021 saw the highest hiring rates on record since we began recording LinkedIn Hiring Rate data in 2015.
While the hiring spree may settle down, this sustained trend suggests we’ve entered into a “worker’s economy” — a new labor market dynamic we haven’t seen in decades where job seekers are having an easier time finding and securing better job opportunities, with far less competition. Workers are even job hopping within their own companies, as the share of members being promoted increased by 9% from January through October of last year, a strong rebound from the early pandemic dip in promotions.
We’re also seeing shifts in where we choose to work play out — with many remote workers choosing to “work from anywhere.” LinkedIn data shows cities in Florida, like Miami (+17%), Jacksonville (+14%) and Tampa (+10%), emerged as the biggest gainers of talent inflows. Meanwhile, on the West Coast, San Francisco (-15%), Portland (-13%) and Seattle (-11.7%) saw the greatest outflows of talent. Employers in turn are having to embrace a distributed workforce model, with new roles, like vice president of flex work, being created to help teams ensure effective collaboration no matter where workers reside.
Why we work: Empowered workers are demanding more
The fight for talent has become fierce, and across many sectors, employees have the upper hand. More than we’ve seen in decades, workers are leveraging their skills and experiences to demand more from their employers to get what they want.
New data from LinkedIn’s Global Talent Trends report sheds light on how flexibility has become key to attracting and retaining top talent. LinkedIn has seen a huge boost, over 80%, in job posts mentioning flexibility since 2019. And when employees are happy with their companies’ time and location flexibility, they are 2.6 times more likely to report being happy at work.
Across the board, we also see that job seekers have become choosier — and are willing to wait it out and hunt around for the perfect fit more so than years past. LinkedIn saw a two-fold increase in job posts viewed per application in 2021 compared to 2019, suggesting that workers are more interested in browsing the job market than jumping at the first offer.
While the pendulum will ultimately tilt back at some point, workers are in the driver’s seat right now and likely will stay in a position throughout 2022. To meet the current moment, employers need to stay nimble and keep adapting their playbooks to remain relevant as more workers consider making a career jump to find the right fit.
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