In recent times, companies have shown a growing preference for part-time workers over full-time employees. According to a recent analysis of job postings on the site Indeed, demand for full-time workers has remained flat from January 2022 to May of this year, while advertisements for part-time positions have increased by about 10% over the same period. This shift in hiring patterns has been significant, with part-time job postings soaring in 2022 and maintaining elevated levels ever since. While full-time employment still dominates on Indeed, the rise in part-time opportunities is a notable trend in the labor market.
The trend of hiring part-time workers has been reflected in hiring activity as well. Data from the Labor Department shows that part-time employment was up 8.9% in May compared to January 2022, while full-time employment only saw a 1.5% increase during the same period. This shift in employment patterns could potentially signal a turning point in the labor market, a crucial aspect of the economy that the Federal Reserve closely monitors as it considers the timing of interest rate adjustments.
San Francisco Fed President Mary Daly recently highlighted the evolving job market dynamics at an event, pointing out that the labor market has been adjusting slowly, with the unemployment rate showing only a slight increase. However, Daly cautioned that future labor market trends could lead to higher unemployment as firms may need to adjust not just vacancies but actual jobs.
Despite these shifts in the labor market, the overall job market in the US remains robust. However, there has been a cooling off in recent months, with the unemployment rate creeping up to 4% in May after remaining below that threshold for over two years. Additionally, the number of new applications for unemployment benefits has been trending upwards, indicating a potential increase in layoffs. The decrease in job openings from record highs in 2022 also suggests a shift in the employment landscape.
The rise in part-time work could be attributed to various factors, including employer preferences, workforce flexibility, and economic conditions. Employers may be responding to a tight labor market by offering part-time roles to attract workers with the promise of flexibility. Alternatively, as the economy cools, employers may be adjusting their workforce needs, leading to an increase in part-time opportunities for workers who desire or require them.
The industries most likely to advertise part-time work include beauty and wellness, personal care, retail, food service, and sports. Job postings offering part-time work have seen significant increases in sectors such as beauty and wellness, marketing, hospitality, media, and entertainment. This trend of rising part-time work is reminiscent of patterns observed during the Great Recession, where part-time employment surged.
Inflation in the US has shown signs of stabilization, with prices remaining unchanged in May. This has provided a welcome relief to cost-conscious Americans and has helped bring inflation closer to normal levels. Factors such as falling gas prices and cheaper goods have contributed to slowing overall inflation, with food prices experiencing only a modest increase.
Looking ahead, upcoming economic indicators and events will provide further insights into the state of the economy. Key releases include business surveys gauging economic activity, inflation data, job market figures, earnings reports, and minutes from the Federal Reserve’s policymaking meetings. These developments will be closely watched to assess the ongoing impact of changing labor market dynamics and inflation trends on the broader economy.
