Jobs Market Update
It’s the start of a new year, and at NW Recruiting Partners, we’re excited to help you navigate the evolving hiring landscape. As we step into 2025, we’re closely monitoring the latest market developments that are shaping hiring and workforce planning. By understanding these changes, we can better support our clients and candidates in achieving their goals.
Here are four key market updates influencing the current hiring environment:
Jobs Report Ends 2024 on a High Note
The final jobs report for 2024 exceeded expectations, adding 256,000 jobs in December – much higher than the projected 155,000. Average wages also increased by about 0.3% with a 12-month gain of 3.9%, pointing to a downtick in wage inflation. All in all, the report shows a still-strong jobs market that lowers the likelihood of further Fed rate cuts in the year ahead.
Meanwhile, a report from the World Economic Forum projects that 170 million jobs will be created by 2030. However, 92 million jobs will disappear, for a net growth of 78 million jobs in the next 5 years. As you might expect, tech jobs are among the fastest-growing, while “analog” administrative jobs are on the downfall. We’re keeping an eye on which sectors are growing, which are shrinking, and where reskilling and upskilling offer opportunities to transform careers.
Labor Supply Challenges Ahead
According to Indeed’s 2025 US Jobs & Hiring Trends Report, labor force growth slowed in 2024 to a monthly average gain of 76,000 workers – just above half the pre-pandemic average. While “prime age” labor participation (workers between the ages of 25 and 54) remains near historic highs, it’s not enough to fully offset an aging workforce. In turn, a potential shortage of workers could make it harder to continue creating new jobs, even necessary ones.
Many organizations are bracing for further challenges to the labor supply in 2025, particularly due to an aging labor force and a likely pullback on immigration. That’s why we’re also focused on our next trend…
Embracing “The Great Stay”
iHire’s 2024 Talent Retention Report found that voluntary quits decreased from 43% in 2023 to 39% in 2024. Most talent leaders expect this lower turnover rate to be sustained or shrink even further in 2025. As a result, more organizations are placing greater importance on hiring for long-term permanent roles (rather than short-term or contract roles) and on robust retention strategies. Search firms, like NW Recruiting Partners, can serve as trusted partners to ensure a good fit from the start and provide post-hire support.
The same survey revealed a handful of key insights to retention that we have also encountered in our discussions with clients and candidates:
- Employees seek work-life balance more than ever. 70% of workers say better commitments to work-life balance would entice them to stay put, while nearly half say they’d even take a pay cut in exchange for better balance.
- Pay raises aren’t the cure-all. 62% of employers offered pay raises to boost retention, but 90% of them still experienced significant turnover. Employees surveyed ranked pay as only the sixth-most important factor in deciding to leave.
- Culture drives loyalty. Employees cited toxic work environments (32%), poor company leadership (30%), and dissatisfaction with management (28%) as some top reasons for quitting.
Passive Talent Provides Opportunities
Many employees are in “wait and see” mode. They’re not planning on quitting right now, but they’re also willing to move for the right offer. This growing talent pool provides great opportunities for both recruiting and retention.
On the recruiting side, it signals that organizations have clear openings to capture the attention of top talent. It’s important to maintain a proactive approach with personalized outreach and to maintain a positive employer reputation. Working with a recruiting partner can also provide access to their network of passive talent and their strategies for how to connect. On the retention side, it indicates a need to continually invest in upskilling, career development, and similar processes in order to limit the risk of attrition to “greener pastures.”
The Outlook This Month
Both employers and employees value stability, even when it can feel elusive. As the labor market evolves in the coming months, adapting your talent strategy will be essential. Prioritizing positive and personalized employee experiences—such as career development and work-life balance—can pave the way for long-term success.
NW Recruiting Partners is dedicated to helping you achieve your 2025 hiring goals by providing tailored solutions that align with your unique needs. Reach out to us today to start the conversation!