Will Friday’s Jobs Report Chill or Thrill?

Although October couldn’t conjure much momentum, the month brought little to fear about the overall labor market. That’s according to the latest UKG Workforce Activity Report, published this past Tuesday, and ahead of tomorrow’s jobs report.

The UKG Workforce Activity Report is a high-frequency index analyzing shift work trends from 4.3 million people across more than 35,000 U.S. businesses to understand the economy. UKG publishes a monthly report and hosts a live labor-market briefing each Tuesday prior to the publication of the U.S. Bureau of Labor Statistics’ (BLS) Employment Situation Report, otherwise known as the first-Friday jobs report.

UKG began tracking workforce activity in April 2021, amid the COVID-19 pandemic, as a way to measure workforce recovery from month to month (and now year over year), report what the frontline workforce can tell us about the overall labor market, and provide organizations, labor economists, and the general public with greater insight into the economy at large.

Key Takeaways from October Workforce Activity

So, what happened in the frontline labor market this past month? Overall, shift work decreased slightly (-0.2%) in October 2023 — but it’s no ghost town, as workforce activity remains consistent with past Octobers. That’s been the case for several months now, as we’ve seen remarkable consistency — with an infamous exception, which we’ll address in a moment.

Without spoiling it for those who like to geek out over the results, here are some key takeaways from the latest UKG Workforce Activity Report: 

• Among industries, healthcare increased 0.4% (more on that below), and we saw increases in retail, food service, and hospitality (1.4%), while other sectors declined: manufacturing (-0.4%), public sector (-2.7%), and services and distribution (-0.1%). 
• Workforce activity continues to increase for the largest companies (5,000 or more employees), while it continues to stall for the smallest (fewer than 100 employees). 
• Regionally, we saw gains in the West and the Northeast (each increased 0.4%) and declines in the Midwest (-0.8%) and the Southeast (-0.5%). 

That’s the consistency we’re talking about. At UKG, we’ve seen ups and downs across the labor market for a while when tracking shift work every week. But, with continued talks of an impending recession, interest rates remaining high, and U.S. unemployment at a steady 3.8% as of September 2023, is a surprise around the corner?

A “Jack-in-the-Box” Labor Market

You may have heard UKG economists describe the current situation as a “Jack-in-the-Box” labor market, a nod to the classic children’s toy that’s brought hours of enjoyment, anxiety, or a little of both to millions of kids worldwide over the years. It’s an apt analogy, as each month in the labor market is another proverbial turn of the workforce-activity crank until — Surprise! — something noteworthy pops up and startles us.

Some economists would call the September 2023 jobs report — with 336,000 positions added to the U.S. economy — that long-awaited (upside) surprise. However, UKG economists consider September’s jobs report to be “more trick than treat,” and they expect a downward revision to those stats.

Speaking of surprises, there’s one a lot of people aren’t talking about, though it definitely warrants some discussion.

The Healthcare Industry’s Great Recovery

A positive story that’s gone unnoticed or unreported by many — though not by UKG — is the healthcare industry’s post-pandemic recovery. According to the UKG Workforce Activity Report, shift work in healthcare has increased 8 out of 10 months so far in 2023.

As UKG Chief Nurse Executive and UKG Workforce Institute Advisory Board member, Nanne Finis, RN, MS, wrote this past month while previewing the latest Leading Healthcare industry brief, “healthcare is at a crucial inflection point.”

The pandemic brought challenges for organizations and employees in every industry, but healthcare and its frontline workforce felt the full brunt of it, all while facing labor shortages that existed prior to 2020. As Nanne reported, “Record numbers of those at the sharp end of patient care — physicians and nurses — resigned from their jobs, and, in some cases, left their professions altogether.”

Thankfully, that disheartening trend appears to be reversing this year, as the UKG data is showing positive month-to-month progress. We’ll continue to monitor workforce activity in healthcare — and across industries — to keep you informed of the latest developments.

Making Sense of the Labor Market

So, what does it all mean? For job seekers, it means a positive scenario, where there are more jobs available right now than people to work them. What about for organizations seeking talent? Well, it means they have to work a little harder to attract the best employees — and that starts with making a commitment to serving people and becoming a great place to work.

If you’re leading an organization and want to know what the labor market means for recruiting, we’ve got good news. Next week, here at the UKG Workforce Institute, we’re launching a special partner series with Employ, the parent company of JazzHR, Lever, Jobvite, and NXTThing RPO. We’ll explore recruiting strategies across industries, from healthcare and manufacturing to logistics and the public sector. Join us here, beginning November 7!