Reprinted with permission from Bankrate.com. Find the original article here.
By Sarah Foster, U.S. Economy Reporter
Just three months ago, jobseekers were used to having all the power in the U.S. labor market. That’s all been flipped upside down in the face of the coronavirus pandemic.
Before the virus-induced recession, employers had for years been reportedly struggling to find enough workers to fill vacant positions while the unemployment rate slowly crept to its lowest levels in nearly half a century. Then, states’ stay-at-home orders forced retailers, restaurants, factory floors and offices to close, prompting more than 43 million Americans to apply for unemployment benefits since mid-March.
There’s hope, and there’s fear. Many workers may be recalled back once the lockdowns are lifted, but other U.S. businesses, unable to recover from lost demand and weather the financial setback of being closed for several months, could be forced to permanently close their doors. It means the pandemic might cause damage to the economy that’s hard to immediately repair.
“Something that is really unique to this crisis is that it happened overnight, basically,” says AnnElizabeth Konkel, an economist at the Indeed Hiring Lab. “It’s always been slower than this, rather than going from one of the best labor markets in U.S. history into becoming one of the worst in three weeks.”
What’s happening in the job market right now?
The economy might be rebounding quicker than expected, though it’s unlikely to be as easy to find a job as it once was anytime soon. Employers in May added 2.5 million positions while the unemployment rate fell to 13.3 percent, according to the Labor Department’s jobs report for the month. It was one of the biggest surprises to the upside in history, with economists expecting joblessness to surge to 20 percent and lose roughly 8 million more positions.
Yet joblessness is still the highest since the Great Depression and is expected to be at 10 percent a year from now, according to Bankrate’s Second-Quarter Economic Indicator poll. The survey also found that employers are forecasted to add an average of 470,000 new positions every month for the next 12 months.
If that forecast proves to be true, it suggests the economy may take about three years to create enough jobs to rope everyone who is unemployed. About 21 million Americans in May were unemployed.
Per every U.S. job opening, there’s also about 4.6 unemployed individuals, according to data on labor market turnover for April from the Department of Labor. That’s up from less than one in February, and it’s below the financial crisis’ peak of 6.8 individuals.
Just about 3 in 4 unemployed individuals (or 73 percent) report being on temporary layoff. Nearly 11 percent report having permanently lost their job, an amount that’s increased by 80 percent since the pandemic began. Another 16 percent encompasses new-entrants, such as college graduates, job leavers and people re-entering the labor force.
If firms shut down or remain hesitant to expand as the economy slowly gets back on track, the risk is that there won’t be enough jobs in the near-term for every unemployed person — a total that is unlikely to ever reach zero given natural churn in the labor market.
“You’re now going to have an influx of many workers seeking new jobs,” says Julia Pollak, labor economist at ZipRecruiter. “There will be highly experienced, highly trained people competing with new college graduates for the same jobs, crowding out less experienced workers and taking on lower pay itself. It’s going to be an incredibly competitive labor market.”
If you’ve lost your job, are looking for a new position or are soon going to be entering the labor force after graduating college, here’s seven steps to prepare for a competitive labor market.
1. Make sure your application is robust and free of mistakes
Nothing can derail an application more so than an error. That’s even more the case right now.
The labor market isn’t as tight as it once was, meaning employers who’ve been inundated with applications might be looking for even the smallest of excuses to discard an application from the pile.
You’ll want to pay close attention to your cover letter and resume. Make sure your entire application is free from grammatical errors and misspellings. Do your research on the position you’re applying for, and mention in your cover letter how you could fulfill those needs. Listing your previous work experience is also one of the best ways to get a call back, both on your cover letter and resume, according to ZipRecruiter research. And if you’ve just graduated from college and don’t have much experience yet, be sure to convey lots of enthusiasm, Pollak says.
“Job seekers are going to have to use all the best practices of how to search for a job,” Pollak says. “If you list two or more previous jobs, even if they’re college jobs or things like that, you’re much more likely to get called back by an employer than if you just list one. It’s simple things — making sure your profile is robust and complete.”
2. Keep an open mind on pay and be flexible on other benefits
But recessions can be particularly challenging for your personal finances if you’re having to search for a new job: You might not have as much leverage to negotiate for higher pay.
New labor market entrants are entering the job market as tens of thousands of other more experienced workers have just lost their job. Meanwhile, others might be more prepared to take a lower-paying job than they would have been months before the pandemic. All of this is going to put downward pressure on wages.
Be sure to keep in mind other benefits that can also impact your finances, such as employer-based retirement plans and health insurance. And don’t decline a job just because it isn’t offering what you’d like it to pay you, Pollak says. This period of weak wage growth should eventually pass, and when the labor market picks back up again, you’ll be able to hop around for higher pay if you still feel like you’re not getting adequately compensated.
“When people get back into the game faster, when they apply for jobs and monitor the job market, that can actually speed up a recovery rather than people staying on the sidelines and holding out for something they imagined that doesn’t exist anymore,” Pollak says.
3. Make your application computerized and utilize job-search sites
Stay up to date with what’s out there for you by utilizing technology, which has dramatically changed the way employers look for jobs and potential employees.
Update your LinkedIn profile to network with recruiters and potential colleagues. Go ahead and use job-search websites to find more positions that you might not see in your immediate geographical area. Of course, doing so requires optimizing your application for online systems and making your resume readable for computers.
4. Leverage your network and make new connections
For those jobs that you don’t find online, it’s also a wise idea to reach out to contacts in your network who you’ve previously known at a professional level. Once you’re on a job-search site such as LinkedIn, you can also find ways to establish professional connections with potential recruiters and employers.
Word-of-mouth has also proven to be a powerful tool for finding new employment, Konkel says.
5. Build new skills and strengthen the ones you already have
Now is the perfect time to bolster your application by building new skills and strengthening the ones you’ve already developed. Microsoft Excel is one of the most searched-for technological skills, according to ZipRecruiter data.
Spend some time also thinking about what you can bring to the table at a job. Those skills can be both areas you’re certified in, as well as soft skills that are transferable. Find creative ways to flaunt them and market them to different industries.
“If you’ve been a manager at a restaurant, turn and look at the skills that you had as a manager, and ask, ‘What could you apply to being a supermarket manager?’” says Alison Sullivan, career expert at Glassdoor. “Identifying those that you can transfer to other industries is a really big way that you can help find opportunities out there for you.”
6. Keep an open mind to new opportunities
Finding a job right now requires a lot of persistence and patience, and that might mean taking a position outside of your preferred area, just to get you by.
Economists are also predicting that the pandemic might lead to new jobs down the road, such as contact tracers and temperature checkers. Consider applying for those emerging jobs, and find ways to transfer over your current skills and experience.
And in the meantime, get creative about finding work, if you need more financial support. Consider taking a freelance gig or temporary job to help pad your wallet, which could also be a stepping stone back into the workforce.
“The job search right now requires thinking outside of the box and also being open to an opportunity that isn’t your dream job,” Konkel says. “I would encourage jobseekers to take opportunities as they come right now.”
7. Be persistent, and apply often
Virtually no industry has been left unscathed from the pandemic, Konkel says. Positions in the hospitality and tourism industry have seen the steepest declines, according to Indeed data. And while smaller metropolitan areas and rural communities have seen a rebound in job postings, they’re down significantly from last year’s levels in the largest metros and other areas that are social distancing more.
“There are some employers who are hiring, but I would encourage jobseekers to continue to apply and have patience,” Konkel says. “Overall, there has been no sector or industry that’s been unscathed during this crisis, and the coronavirus is impacting every angle and facet of the economy.”
In the meantime, safeguard your finances
While you’re looking for work, make sure your finances are on solid footing. Cut back on your discretionary spending, boost your expenses and take advantage of any goodwill programs made available to you through any banks, lenders or utility companies you use.
Meanwhile, if you’re unemployed, be sure to apply for unemployment insurance to help replace the income that you’ve lost. You should have up to about 39 weeks of benefits available to you thanks to the CARES Act, Congress’ third fiscal care package in response to the pandemic. Until the end of July, you should also receive an extra $600 in your weekly payout.
All in all, it’s safe to say these next few months, if not years, are shaping up to be a challenging time if you’re a jobseeker. It’s dramatically different from the environment just three months earlier. But if you stay persistent and practice these steps, it’s more likely to pay off, Pollak says.
“Even when there is a competitive labor market, there are some people who still strike it lucky,” Pollak says. “If you’re applying and monitoring every day, chances are you will get a job and a good job. This is really a time to understand that the job market is really competitive and to be the best competitor you can.”