The job market could see significant changes in July, according to a new AI-driven report. (iStock)
After a strong jobs report in June, there could be a shift in the type of hiring employers are looking for, according to new data from an AI-driven forecast by Turn in July.
In the next jobs report, Turn forecast the unemployment rate to fall to a seasonal low of 3.5% in June on a 64.7% rise in hiring, a trend that could continue through late July. Turn forecast a significant shift away from filling pandemic-related hourly jobs like warehouse positions after hiring for traditional economic positions like retail workers and janitorial jobs rose 210% in June.
Turn also predicted an increase in hiring for semi-skilled and paid jobs such as mechanics and nurses in July. While hiring for these positions accounted for just 11.5% of monthly jobs over the trailing 12 months, Turn predicted these positions will account for 22% of all new hires in July.
“In June 2022, there was a large shift to the semi-skilled workforce when both hiring and employment growth increased by 171%,” Turn explained in his report. “The biggest growth positions were Class A nurses, pharmacy technicians, mechanics and truck drivers. Turn forecasts that the upward trend in hiring for semi-skilled workers will continue through July 2022.
The latest jobs report from the Bureau of Labor Statistics (BLS) showed that total nonfarm payrolls rose by 372,000 in June, while the unemployment rate remained at 3.6% for the fourth straight month. This was driven by job gains in professional and business services, leisure and hospitality, and healthcare.
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JOB GROWTH DISCOVERED IN JUNE amid RECESSION FEARS
This is where recruitment is expected to increase the most
Looking at the top companies driving growth in semi-skilled and salaried jobs, Turn found 511 companies each contributing a median of 3,300 jobs to the economy. Here are some companies Turn predicts will grow through the end of July:
- Amazon: 261% job growth at 7,800 locations
- Powertrain solutions: 269% job growth across 3,900 locations
- Walgreens: 20% job growth at 5,300 locations
- Great Clips: 12% job growth at 6,500 locations
- Dollars General: 51% job growth at 4,300 locations
Additionally, here are the top 5 cities expected to post the strongest monthly job growth in June-July:
- New York, NY: 18.8% employment growth in 29,300 companies
- Sacramento, California: 16.3% employment growth in 3,900 companies
- Seattle, WA: 14.4% employment growth in 8,100 companies
- San Diego, California: 11.8% job growth in 7,500 companies
- Arlington, Texas: 11.3% employment growth in 4,800 companies
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INFLATION REACHES A NEW 40-YEAR HIGH IN JUNE – WHAT IT MEANS FOR INTEREST RATES
What job growth means for interest rates
As the U.S. job market returns to pre-COVID-19 levels, rising inflation will increase demand for hourly workers, according to Turn’s data. Along with inflation, a strong labor market is another incentive for the Federal Reserve to raise interest rates.
Inflation is currently at a 40-year high, with the consumer price index (CPI) rising 9.1% annually in June. This will likely prompt the US Federal Reserve to continue on its current trajectory of raising interest rates, despite the ongoing risk of recession.
The Federal Reserve recently released minutes from its June meeting, showing that another 75 basis point rate hike could be on the table at its next Federal Open Market Committee (FOMC) meeting in July. In June, the Fed raised interest rates by 75 basis points, the highest hike since 1994. This was the third rate hike of 2022 and brought the federal funds’ target range to 1.5% to 1.75%.
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