May 2022 Market Brief: Sky-High Inflation Has a Grounding Effect
Breaking Records is Starting to Sound a Lot Like Broken Records
A pun: The problem with the economy is that there’s too much month left at the end of the money.
Inflation reached a new 40-year high. Breaking records is starting to sound a lot like broken records. People keep paying more for things, often for less of it; jobs continue to outpace workers. One thing that is new: as financial pressures mount, workers, particularly women, are making their way back to the labor force.
It’s not all same-old, though. In the biopharma world, miracles abound with several companies making major announcements about therapeutic breakthroughs. We cover these hopeful stories further in our Connect the Dots section, below.
First though, let’s look at what’s happening in the Engineering and Sciences labor market.
Engineering and Sciences Labor Market
Companies looking to hire engineering and sciences skills and capabilities are currently looking at 0.15 unemployed workers per job opening—these workers continue to be in high demand and harder to find.
Overall Unemployment Rate: 3.6%
Unemployment Rate by Labor Category:
Architecture + Engineering: 1.4%
Sciences-Life, Physical, Social: 1.1%
Employment Trends in Engineering and Sciences
1. In the Utilities Industry:
- Demand for Software Engineers and Testers was up by 18 percent between April and May. Universities top the list of competitors for this talent as they ramp up clean energy research and development programs, likely in anticipation of the Department of Energy’s multi-billion-dollar investment in transmission projects and enhancements to the cybersecurity of power systems
- President Biden waived tariffs on solar panels from four southeast Asian countries for two years and invoked the Defense Protection Act to promote increased production of solar panels. As with most things these days, whether this is a good idea or not depends on who you ask.
2. Strong product demand was evident in Consumer and Industrial Products, according to Manufacturing indexes, though the industry did experience a slight decline in employment due to supply chain constraints. Quits were down, which is good news for an industry struggling to find workers. Automation appears to be one solution employers are turning toward, with Q1 orders for workplace robots increasing by a record-high 40 percent year over year in the US, potentially signaling increased demand on already in-demand software, electronics, automation, and related engineers.
Be sure to download the in-depth engineering and sciences report compiled by our market analytics team for additional monthly insights.
Connecting the Dots
- Inflation. Gas prices are up more than 55 percent from this time last year, and up 72 percent since 2019, and climbing. The rising prices on everything are taking a personal toll as consumers pull back on spending. Average hourly earnings increased 5.2 percent year-over-year in May, but economists predict these increases have hit their peak and will begin to slow. The state of the economy is top of mind for recent graduates and early career workers who find themselves struggling to take on purpose-driven work out of need for a better paycheck. In Deloitte’s 2022 Global Survey of Gen Z and Millennials, financial concerns top the list of worries for these workers, with nearly 50 percent of the 15,000 respondents indicating they live paycheck to paycheck.
- Brain Drain. This refers to the loss of talent local employers are experiencing as work-from-anywhere takes hold and local workers get scooped up by stronger offers, remote set-ups, and improved benefits in other parts of the country. In January 2020, fewer than 3 percent of applications for job postings on LinkedIn were for remote work. Today, applications for remote work in small and mid-sized cities have increased to over half. Finally, forget annual compensation reviews. Many companies are conducting these regularly as part of their retention strategy.
- “You get a nod!” Intuit is responding to intense competition for talent with a “no application goes unrecognized” recruiting process. The software maker is responding to every one of its 4,500 internship and first job applicants regardless of whether they’re making offers. The reason? Peer influence on social media. The company knows its brand could take a hit if they don’t care for the employees they already have, or the ones they could have had.
- Miracles. A small Memorial Sloan Kettering trial, backed by GlaxoSmithKline, has achieved a monumental result: the total remission of cancer in all 14 of its patients with early-stage rectal cancer. The results are preliminary, and the trial is not over, but this is a hopeful, transformative step forward in cancer treatment. In other news, Pfizer earned a breakthrough therapy designation status as a result of its maternal immunization that provides antibody protection against the potentially deadly Respiratory Syncytial Virus (RSV) in newborns.
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Actalent's May 2022 Economy and Labor Market Report synthesizes information from a variety of sources including the United States Bureau of Labor Statistics survey results, Emsi-Burning Glass, media reports, industry intelligence, company earnings reports, and external labor market data. The full set of data is included as a companion to this article.
If you'd like more information on the data presented, or have questions about the information provided in this report, please contact our team at: email@example.com.