Monday means markets on this show; there’s some solid data here.
The May jobs report shows strong hiring and wage growth, contradicting the narrative of a cooling labor market. Payrolls increased by 272,000, with notable growth in health care, government, and leisure and hospitality sectors. Average hourly earnings rose 0.4% last month, and wages are up 4.1% over the past 12 months. The report raises doubts about a potential rate cut by the Fed and led to a surge in Treasury yields. The unemployment rate increased to 4%, prompting concerns about underlying weakness.
That said, there are issues in the white-collar labor market. Job applicants are facing a lengthy and complicated hiring process, with employers reluctant to let workers go and not in a hurry to hire. While the labor market may be good for quelling inflation, it is frustrating for job hunters. Additionally, the new remote working world is disrupting work friendships, adding to America’s worsening loneliness crisis.
According to new data from the Bureau of Labor Statistics, a record share of working-aged women are employed, surpassing pre-pandemic levels. The increase in employment in the childcare sector has enabled more women to work, contributing to this remarkable comeback story. However, the employment number in May 2024 is only slightly higher than it was nearly a quarter-century ago.
IT unemployment in the US fell to 2.5% in May, while job postings increased to 209,000, according to a CompTIA report. This indicates a growing demand for tech talent and a potential pent-up demand for digital growth initiatives. AI-related occupations accounted for 12% of job postings, and data scientist roles saw a 24% month-over-month growth rate.
Strong job growth, particularly in critical sectors like healthcare and government, suggests a stable economic environment, which should translate into steady demand for IT services across these sectors.
The significant growth in AI-related and data scientist roles indicates where the industry is headed. IT service firms should invest in upskilling their workforce in these areas and consider expanding their service offerings to include AI and data analytics solutions to meet market demand. You have time, but standing still is unwise.