There is good news as it relates to the job market. How can listeners can take advantage of it?
Mellody: In the last Money Monday segment, we covered the strong housing sector, which is a key component of the U.S. economy. On Friday, we received some great news from the Labor Department. According to the report, the U.S. economy added 255,000 new jobs in July, crushing estimates of 180,000 new jobs and resetting expectations for the nation’s economy performance.
And while the headline unemployment rate held steady at 4.9 percent, the labor force participation rate ticked up one-tenth to 62.8 percent, indicating that the economy and worker confidence are high enough to lure those who had stopped looking for jobs to back into the job market. And hourly wages again moved higher, increasing by 8 cents or an annualized pace of 2.6 percent.
All of these indicators point to a tightening job market, and that provides an opportunity for our listeners to benefit.
What about jobseekers who are looking for a job, or want to change companies? What should they be thinking about?
The biggest opportunities in a tighter job market are two things: compensation and advancement. In order to land your next job with your ideal compensation package or advancement, you need to do your homework and prepare ahead of time. First, do your research to understand the state of the industries that you are looking for employment in.
Are they outperforming or underperforming the broader economy? Also, look at the labor market for these industries, and the average salary information for the position you are looking at and the skills that are required. Put together, all of this information will tell you how aggressive you can be when asked to provide your preferred salary range.
You also want to learn as much as you can about what each company you are applying to provides in the broader compensation package in comparison to their competitors. This will allow you to negotiate non-salary compensation, including paid vacation days and professional development opportunities. The important thing for all of you looking for a new position to remember is that the tightening job market gives you leverage, if you are willing to do the work.
If you are happy with the company or firm you’re already at, can you still benefit?
Absolutely! Just because you like where you work and you want to stay there does not mean that your company has nothing to worry about. When the labor market tightens, firms definitely face challenges of keeping talent, and losing talent is no small issue. Most companies do not want to go through the process of recruiting, hiring and training new employees when they can simply keep the talent they have.
Because of this, it is a great time to bring up that raise you have been thinking about, the promotion you want, or the professional development opportunity that you are hoping for. Now this may mean waiting until your annual review, or another opportune time to broach the topic, but the current labor market is on your side. And if you do have some time between now and when you have your review, it is an opportunity to make yourself indispensable; work hard and prove yourself ahead of time, and you will be sitting pretty when the time does come.
Any other tips?
First, even though the labor market environment is on your side, you still want to stand out for your current or potential employer. Right now is a great time to work to improve your current skill set, or expand it to include new ones. For example, taking a class through a massive open online course platform that fits your current or your ideal job is never a bad idea, and it will allow you to stand out while others are relying solely on the tight job market to get ahead.
Finally, you have heard me say it here before: in order to get something, you have to ask for it. The real challenge for most people is breaking through that first barrier and raising the subject to begin the conversation. For many people it can be nerve-wracking, but you if you don’t, you are always just waiting for others to give you what you are worth.