2024 Economic and Job Market Forecast

Feb 14th, 2024 | Hire Wire

It’s no secret that both the employment and economic markets have been undergoing massive swings since the pandemic first struck in February 2020. From the layoffs due to shutdowns, the hiring rebound once shutdowns were rescinded, GDP retraction and now back to growth again, and inflation spiking and now receding, it can be very difficult for an organization to effectively plan for headcount in. Today, we will be sharing where the markets have been, where they are now, and where we expect them to be in 2024.

One of the most important things an organization must have in order to add headcount to their organization is to ensure they have a steady – or even better – growing stream of revenue. In terms of the overall economy this number is reflected by a country’s Gross Domestic Product, or GDP, which is a measure of all goods sold and services provided in a given year. Since the end of Q2 2020 – with the exception of Q1 and Q2 of 2022 – the U.S. economy has had positive GDP growth in all quarters. In layman’s terms, this mean the economy is growing. Q4 of 2023 yielded 3.3% GDP growth, far exceeding what most Wall Street economists expected. The bottom line: the economy is on very stable footing.

With GDP growth meeting or exceeding expectations, especially coming off of the challenges of the pandemic, one would be forgiven in thinking that the economy is near invincible. There is, however, one thing that can even derail a growing economy and that is inflation. We all have seen it: we’re spending more for goods and services. From the grocery store to car dealerships, we are all feeling the impact on our wallets. This has not gone unnoticed by The Federal Reserve who has been increasing interest rates in an effort to combat inflation. That effort has largely been successful with inflation coming down to 3.1% in January of this year from its high of 9.1% in June of 2021.

With the economy stable and inflation on its way down to normal levels we should be seeing a robust job market and that is exactly what is happening. In December 2023, there were 9 million job openings across the U.S. economy – an unquestionably health number - and unemployment remains at a near-record low of 3.7%. With demands for workers at near record highs and the number of available workers at near record lows this makes hiring more difficult that it has been in years past.

So, what does all this mean for organizations who want to increase their headcount in 2024? It certainly won’t be easy but there are steps you can take to make it feasible:

• Ensure you have robust employer branding in place. This makes your open jobs more attractive to a job seeker.
• Construct an interview process that focuses on a positive candidate experience. Make the interview thorough and the timeline for feedback and decision making quick.
• Ensure your compensation and benefits are competitive – this is especially important in a tight labor market
• Take the pulse of your employees and ensure clear and consistent communication with the entirety of your workforce. This will help ensure that you can retain your employees, otherwise all that work spend on recruiting top talent to your organization will be for nothing.