The Labor Market Outlook in the Pandemic Economy
This past year has brought nearly unprecedented challenges that have tested businesses and leadership, from a global pandemic to social upheaval and unrest. Millions of workers have experienced changes that have profoundly transformed their lives as a new global recession brought on by the COVID-19 health pandemic impacts economies and labor markets. What does this mean for the labor market outlook? The latest ManpowerGroup Employment Outlook Survey and The Future of Jobs Report 2020 from the World Economic Forum provide insights into both short and long-term trends impacted by these evolving challenges.
Hiring outlook improves
The positive news is that hiring outlooks are showing signs of recovery around the world. Compared to the previous quarter, hiring intentions for the first quarter of 2021 have improved in 32 of 43 markets with the most significant increases reported in the Asia Pacific and Americas regions with employers in Europe showing the greatest caution. Employers in all 12 U.S. industry sectors report positive outlooks with the strongest outlooks in the leisure and hospitality sector as businesses re-hire some of those furloughed or laid off early in the pandemic.
Recovery expected to take time
At the same time, employers expect to be cautious for the long term, with 13% saying pre-pandemic hiring levels will not return before July 2021. Strongest hiring intentions are reported by employers in Taiwan, the U.S. and Singapore. Employers in Europe are the least optimistic about a return to pre-pandemic hiring levels with most predicting after October 2021. Over one-quarter of employers in Asia-Pacific countries say pre-pandemic hiring will return by the New Year while those in the Americas are most optimistic about a July 2021 return.
Industry differences in recovery rates
Not every industry is expected to recover on the same timeline. According to the World Economic Forum's report, industries like recreation and travel are expected to see continued slumps, while it is not surprising that the healthcare industry has maintained the closest to comparable hiring rates to this time last year. While hiring figures have stopped trending in a negative direction in the period up to July 2020, this recovery remains tentative, with unequal geographic and industry patterns.
In summary, the new year brings with it an optimistic outlook for short-term hiring outlook, but with the expectation that long-term return to pre-pandemic labor market levels may not fully return by the end of the year.