Top U.S. Labor Markets: 2 New Metros, Both in Florida, Reach Full Jobs Recovery in September

October 22, 2021
|
Author: Mallory Vachon, Ph.D., Senior Economist, and Jonathan Blair

Since early summer, the economic recovery has slowed substantially, and perceptions have shifted about the overall state of the labor market. Following massive job gains that topped 1 million in July 2021, the August and September jobs numbers came in well-below expectations, due to the COVID-19 Delta variant.

Many areas reported big gains, and Jacksonville and Tampa joined Salt Lake City, Phoenix and Austin, as the first to reach their pre-pandemic employment levels. Several more metros — including Raleigh, Memphis and Dallas — have had strong recoveries and are poised to reach pre-pandemic employment by late 2021 or early 2022.

The labor market has transformed since early 2020, and the dynamics we see today — record job openings and quits, the emphasis on hybrid or remote work, rising wages — are unlikely to subside any time soon. Enduring supply-chain challenges and increasing prices of goods present additional challenges for businesses and individuals to overcome.


Click on the orange circles on the map above to see key hiring stats for the 50 largest labor markets in the U.S. Below the map, find out which labor markets topped LaborIQ’s lists for these metrics in September 2021. All figures used are seasonally adjusted.

The pace of recovery has varied greatly across geographies and industries. While five metros have reached pre-pandemic employment levels and continue to add jobs and attract workers, other locations — especially in the Northeast, Midwest and Gulf Coast — will more slowly recover lost jobs.

Although the economy is trending toward recovery, recouping jobs lost doesn’t mean a return to the pre-pandemic labor market or economy; jobs will be return, but in different industries and locations. A slow recovery can be difficult, but with consecutive months of record job openings and businesses looking for workers, talent acquisition professionals remain in high demand.

Talent acquisition professionals who can pinpoint the best locations to target recruitment efforts and source talent will have an advantage. With job openings at record highs, luring workers with competitive wages, managing the skills mismatch and overcoming other disrupters is critical to the labor market’s recovery.

If you’re recruiting in an area or industry at the front end of the recovery, targeting recruitment efforts to areas that are lagging could be a winning strategy to attract top talent.

ThinkWhy’s talent intelligence software, LaborIQ®, assesses the health of job markets based on several factors including:

  • Current employment level compared to the pre-pandemic level
  • Number of new jobs added
  • Percentage of growth in jobs from the prior period

Metro Recovery: Comparison to Pre-Pandemic Employment

An important current indicator of economic recovery and the availability of talent is how employment compares to February 2020, just before the pandemic. This metric may not shift drastically month-to-month, but it’s worth watching these metros because the talent supply is tightening.

Salt Lake City became the first large metro to reach pre-pandemic employment levels in June, followed by Austin and Phoenix in August, and Jacksonville and Tampa in September. Several other metros —mostly in the south — look poised to reach pre-pandemic employment levels in the coming months. Businesses in these areas will likely search for workers in other metros to relocate or work remotely to keep up with demand.

LaborIQ lists the following cities as having recovered all jobs lost or being closest to reaching their pre-pandemic employment levels, in order of their current employment relative to pre-pandemic levels in February 2020.

Recovered

Top 5 Large Metros Most Likely to Recover Soon

Most New Jobs Added

The highest volumes of new jobs added each month are largely influenced by a location’s population. However, given the depths of the job losses, and the recovery yet to happen, these locations are an important component of progress to full recovery.

Tampa had a strong September with more than 30,000 jobs added, leading large metros, while New York, Houston, Chicago and Dallas were not far behind, each with around 20,000 jobs added. Notably, Los Angeles did not make the list — having lost nearly 25,000 jobs in September — after months near the top of the list.

By sheer volume, these larger markets will continue to lead in job gain even though the pandemic had a unique impact on the workforce in these locations. Large metros lost more jobs and — in the case of New York and Chicago — are farther behind in the jobs recovery, relative to other areas.

A significant number of jobs is expected to be added in these locations over the next few years, driving strong demand for talent acquisition professionals. Seasonal hiring volume will leave many employers in these areas short of staffing requirements, exacerbated by the current labor shortages. Larger metros will face an acute impact based on higher consumer demand and job openings.

Highest Month-to-Month Job Growth

Job growth allows for more flexibility to compare labor market strength regardless of population. September metro-level employment data, combined with LaborIQ’s analysis of the nation’s top 50 most populous metro areas, show the large metros in Florida and Texas leading in job growth.

While these lists focus on the top markets for each metric, refer to the map above to find opportunities for your business. Locations underperforming in these categories, particularly related to pre-pandemic employment levels, may have a desirable talent pool or opportunity for your business.

Conclusion

While the labor market continued to level off to the new normal, the economy added nearly 3.2 million jobs since May 2021. Of the top 50 largest metros, 12 had negative job gains in September — up from 8 in August. But many large metros saw strong job gains and growth in September, making them great locations for talent acquisition and recruitment.

A decreasing number of COVID-19 cases is once again giving some companies more confidence to reboot return-to-office plans, along with filling open roles. Additional recruiting resources and creativity will be required to keep operational efficiency during these transitions.

Of course, even with robust demand for talent, a variety of factors are creating challenges to fill the record number of open jobs. Record quits (voluntary departures) and worker confidence in obtaining higher wages or desired workplace flexibility continue to play major roles in the transition of talent this fall. In all, demand for hiring has never been stronger, but supply challenges will persist for at least the next few months and likely into 2022.

LaborIQ by ThinkWhy continuously forecasts and reports labor data at all levels, measuring impact to cities, industries, occupations and business across the U.S.