2023 Job Market: Pay, Work From Home, Who’s Hiring and More
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What should workers expect from the 2023 U.S. labor market outlook?
Here's your Money Briefing for Wednesday, January 4th. I'm J.R. Whelan for The Wall Street Journal. Last year, the great resignation and demand for both higher salaries and more work-from-home flexibility all added up to workers holding the balance of power in the labor market. But with growing economic uncertainty, more companies laying off staff, and a jittery stock market, things are looking different for workers in the year ahead.
I think we're going to have a little bit of a slowdown, but I don't think it's going to be an overarching recession. So more companies are admitting they're going to hire, but they're not planning to hire in volume.
So who is hiring? And what are worker pay and flexibility likely to look like this year? On today's show, we'll hear from LaSalle Network staffing firm CEO Tom Gimbel about what he's hearing from companies on those topics and more. That's after the break.
As the job market recovered from the grips of the pandemic, worker pay rose substantially, and a hybrid work schedule became the staffing model for many companies.
How is the employee-employer balance of power shifting in early 2023?
But what's the labor market going to look like in 2023 for both job holders and job seekers? Tom Gimbel is founder and CEO of the LaSalle Network staffing firm, which surveyed business leaders around the country about their plans for the coming year. Tom, thank you very much for being with us.
Always good to be with you, JR. Thanks for having me on.
So, you know, Tom, in the last year, we saw companies reopen as restrictions were lifted, but we also saw employees gain a lot of leverage as they were on the hunt for higher salaries and flexibility. How is that balance of power likely to change in 2023?
Well, it's a really good question, JR, and the balance of power between employees and employers has already started to change. We're seeing that companies are no longer giving exuberant counteroffers to get people to stay, and the main reason is because the candidate supply has increased a little bit. As we're seeing, it's starting with the big tech companies, with the layoffs we've seen in Google and Meta, Facebook and Amazon and such, and starting to see it with smaller tech companies as well.
How will hybrid and remote work policies change this year?
The balance of power is definitely going back to the more traditional model of employers offering what they feel is the best salary for the role versus being a little bit held hostage by record low unemployment.
And, you know, a big part of that employee leverage equation has been flexibility. And we saw companies kind of settle into a hybrid work schedule in 2022. It could have been for health reasons or maybe just to appease workers who don't want to be in the office. How do you think that will change in 2023?
We're seeing the majority of companies north of 80% that are going hybrid.
Is the pace of hiring slowing and which industries will still hire?
So it's Tuesday, Wednesday, Thursday, I feel is going to be the new norm. And I think you're going to see some companies will actually go Monday through Thursday that'll be in the office. What it looks like it's going to be is companies are going to go fully remote or hybrid three to four days a week. There won't be a lot of employees can come in whenever they want or pick two days a month. It's going to be a pretty standard schedule is what we're seeing right now, and the market is allowing for that. And there's always going to be a few outlier companies that are going to say, hey, we can save money.
Which sectors — like manufacturing, health care, or professional services — are most likely to add jobs?
Culture isn't our thing. It's more about productivity of purely getting results today and tomorrow or very heavy tech versus marketing sales and call center. And so they'll stay remote.
All right, so let's talk about hiring in the new year. Last year we saw companies hire workers as fast as they could fill open slots as workers change jobs, you know, to chase higher salaries. Is that pace of hiring likely to hold up this year?
How can job seekers overcome the current skills gap to get noticed by employers?
You know, 2023 is going to be a really interesting year. I think we're going to have a little bit of a slowdown, but I don't think it's going to be an overarching recession. I think we'll have industries like in big tech at the tail end of last year and VC-backed companies that are pre-profit that are going to have some problems in the first quarter and the first six months of the year.
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Chapters
8 chapters
1
What should workers expect from the 2023 U.S. labor market outlook?
0:05–1:08
2
How is the employee-employer balance of power shifting in early 2023?
1:08–2:08
3
How will hybrid and remote work policies change this year?
2:08–2:42
4
Is the pace of hiring slowing and which industries will still hire?
2:42–3:15
5
Which sectors — like manufacturing, health care, or professional services — are most likely to add jobs?
3:15–3:39
6
How can job seekers overcome the current skills gap to get noticed by employers?
3:39–4:41
7
Will wages continue rising in 2023 and how are pay packages evolving?
4:41–5:36
8
What benefits (health, parental leave) will employers emphasize in hiring packages this year?
5:36–10:39
Speakers
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