Five things to expect from the job market in 2024

Last January, the job market looked pretty grim. Layoffs were rife and people were struggling to land jobs.

Thankfully, heading into 2024, the job scene looks a little bit different. Yes, there are still the long-term ramifications of layoffs on employer reputation and employee morale, but economists project pay increases will increase by just under 4%.

Here are five things worth knowing about the state of the job market as we head into 2024 – by the numbers.

5

In the 30 days following a layoff, employers’ overall rating drops 4% on average to 3.49% from 3.66%, according to Glassdoor’s 2024 Workplace Trends report, And overall ratings stay that low, even 180 days after the layoffs. These ratings (scored by employees) decline in the month after a layoff and are most severe for senior management (-8%) and CEO approval rates (-16%). Depending on how bungled the layoffs process is (and that can vary by company and its culture) remaining employees can remain upset at leaders for the next six months.

“We’re starting to see the long-term consequences of those decisions when it comes to employee satisfaction,” said Aaron Terrazas, chief economist at Glassdoor. “Middle managers were under a lot of fire in 2023 and the pressure they got from above and below. But when employees are unhappy, they have wandering eyes and are more likely to look for opportunities elsewhere.”

4

Despite a softening labor market, Gen Z is poised to overtake baby boomers in the full-time workforce by early 2024 – a shift that has been a long coming. By Glassdoor’s estimates, Gen Z won’t outnumber Millennials in the workforce until sometime in the early 2040s.

3

Wages are no longer growing as quickly as they recently were. Indeed’s 2024 U.S, Jobs & Hiring Trends Report, found the combination of falling employer demand, increasing labor supply, and diminished quitting has resulted in employers handing out smaller raises. This slowdown in wage growth can be seen in a variety of measures of wage growth, including the Indeed Wage Tracker and those from the federal government. The Indeed Wage Tracker peaked first, in January 2022, and the Atlanta Fed’s Wage Growth Tracker peaked last, in early 2023, the report found.

2

Also according to Indeed’s report, the sector with the sharpest decline in job postings in 2023 was software development with a negative percent change of 51.9%. The pullback in job postings has been most stark in sectors tied to previously high-flying industries including tech, where stock valuations have fallen and hiring plans have come back down to pre-pandemic numbers.

“Postings for software development jobs or data science positions are down quite a bit,” said Nick Bunker, Indeed’s director of economic research. “Over the year, job postings that mentioned generative AI grew twenty-fold, but the most recent data, generative AI jobs were 5 in 10,000 jobs on Indeed. It’s still very, very small.” The International Monetary Fund (IMF) projects much lower inflation for the U.S. (2.8%), while Payscale’s 2024 salary budget survey projects pay increases to be 3.8%. Should these predictions hold true, it would be the first time wage growth has surpassed inflation since 2020. However, pay increases will vary by industry and business performance.

1

The International Monetary Fund (IMF) projects much lower inflation for the U.S. (2.8%), while Payscale’s 2024 salary budget survey projects pay increases to be 3.8%. Should these predictions hold true, it would be the first time wage growth has surpassed inflation since 2020. However, pay increases will vary by industry and business performance.