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The recent surge in inflation rates has caused significant impacts on the job market, affecting both job seekers and employers. Working in Talent Acquisition, within the last few years there has been a tremendous change in expectations from employers and job candidates primarily due to high inflation costs across the board. Listed below are key areas in how inflation is impacting the job market and what it means for both employees and employers.
Impact on Salaries: One of the most direct impacts of inflation on the job market is that it puts upward pressure on salaries. When the cost-of-living rises, employees demand higher wages to keep up with their expenses. However, this can lead to increased labor costs for employers, making it more difficult to hire new workers or maintain existing staff levels. When interviewing job candidates, the expectation in salary is 10-15% above average range. A few years back I would have said people are being unrealistic, but being impacted myself by inflation, I now understand.
Skill Mismatch: Inflation can create a mismatch between the skills that employers are looking for and the skills that job seekers possess. As labor costs increase, companies may seek to hire more experienced workers and managers are becoming more strategic in who they hire; if paying top dollars, they are looking for someone who can come in and do the job with minimal training. This can lead to a situation where less skilled workers are unable to find jobs, even as companies struggle to fill positions with more experienced candidates.
Higher Unemployment Rates: Inflation can also lead to higher unemployment rates. As companies face higher costs, they may be forced to reduce their workforce or slow down their hiring process. Additionally, job seekers may become more hesitant to switch jobs during periods of high inflation, which can lead to reduced mobility in the job market. With the recent layoffs, especially in tech, the likelihood of being impacted yourself is at an all-time high. Keeping your resume up to date is a must.
Impact on Small Businesses: Small businesses can be particularly vulnerable to the impacts of inflation. They may have limited resources to absorb higher costs and may struggle to compete with larger companies for skilled workers. Additionally, small businesses may face challenges in passing on higher costs to consumers, leading to reduced profits and potentially even business closures.
During these times, it’s important to work on new skills and/or brush up on existing skills. For myself, I am a HR major and most of my skills are related to this field. However, I see how the world is changing and understand gaining new tech skills will keep me marketable and in-demand. Technical skills are needed in just about any industry and being able to stand out from your competition should be the goal.
Jamelah Henry spent the last 20 years of her career working as a manager, trainer, recruiter and entrepreneur specializing in hiring, training, coaching and developing both existing and new hire employees to bring their best to the workplace. Jamelah is the owner of JH Career Coaching Services, a virtual one-stop career shop where she assists job seekers from all levels and industries with elevating in their careers.
Education and Training include a B.S. in Human Resource Management from Wilmington University and a member of the Delta Epsilon Rho Honor Society. In 2021, Jamelah was certified as a SHRM (Society for Human Resource Management) Professional. In 2022, Jamelah received her credential as a Meta Certified Digital Marketing Associate. In her spare time, she likes giving back to her community supporting causes such as Poverty Alleviation, Economic Empowerment, Civil Rights & Social Action.
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