2024 Outlook: Continued signs of stabilization and increased job seeking activity

By Karin Kimbrough, Chief Economist at LinkedIn

Typically, we see more seasonal labor market activity pick up in January – from kicking off a job search to hiring and starting new roles – although that varies by country. However, the December data suggest the job market continues to stabilize, and job seekers, who are more intent on making a career move, are starting 2024 with some momentum as December provided a springboard for an uptick in activity. In the US, hiring accelerated in December with the US adding more jobs than expected. Unemployment also remained low in the US at 3.7%, signaling that economic growth and the labor market remain solid in the US. 

Across the globe, hiring either began to stabilize or exhibited less severe declines throughout 2023 as the global labor market adjusted to a higher interest rate environment. Going into 2024, we expect the competition for jobs between workers to intensify as more workers begin to look for new opportunities and the pace of hiring levels out. We also continue to see bright spots in the labor market despite a more challenging environment.

Hiring continues to stabilize

In the US, hiring continues to show signs of stabilization with a 5.5% hiring increase in December compared to November, the largest month-over-month increase over the past year. Compared to last year, hiring in December was down 9.9%, which is the smallest year-over-year decline we’ve seen over the past 12 months. The pace of hiring remained mostly unchanged from July in 2023 (+0.4%), which indicates that the labor market has stabilized for now. These positive trends boost hopes that the Federal Reserve will reach their inflation target without a significant rise in unemployment (a “soft landing”).

In 2023, Technology, Information, and Media led the way across all industries in hiring stabilization. While hiring slowed going into the summer, the sector saw increased activity in the last quarter of 2023 and culminated with positive gains in December. Hiring in Technology, Information, and Media is now up 11.6% compared to July (vs overall hiring which is virtually unchanged over the same period).

Globally, we see that hiring declines continue to moderate across countries as labor markets around the world normalize. Across the globe, we saw the pace of hiring slow from January to June. From July to December, hiring continued to slow in many countries but at a slower pace – moderating from steeper declines the first half of the year.  For example, in Canada, the LinkedIn Hiring Rate fell by 8% from January to June but only 1% from July to December. In some countries, hiring appears to have stabilized with the pace of hiring having increased or remained virtually unchanged when comparing July to December. These countries include Australia, the UK, and the US. However, other countries like France and Germany continued to see hiring slow at comparable pace both halves of the year.

Job competition poised to accelerate in 2024

Whether we look at official US, Canadian, Australian, UK, or EU data, the story is the same – job vacancies and openings have come down across the board and show no signs of increasing in our current, global higher interest rate environment. Stabilization in quits (the Linkedin US Separation Rate is unchanged since August) means that we will also see less openings as a result of labor market churn. As a result, competition for jobs between workers is set to pick up in 2024 despite record low unemployment in a number of countries and regions.

Historically, job search activity by LinkedIn members picks up at the beginning of the year, and we expect that to be the case this year as well. Aside from historical trends, we are already seeing signs of a rise in job seeking activity in our Job Search Intensity measure, which measures the rate at which LinkedIn members are applying to domestic jobs. Globally, in 2023 job seeking activity is elevated compared to the prior year. Countries leading the way in elevated job seeking intensity in 2023 are the UK (+27%), the US (+21%), Singapore (+19%), Germany (+18%), and Australia (+16%). 

Overall, the current job market is quite different from what we saw at the height of The Great Reshuffle, where availability of job opportunities matched the number of job seekers in the US. By mid-2023, we saw more slack in the US labor market, with just one job opening for every two applicants – down from a peak of one job opening for every applicant on LinkedIn. With increasingly less jobs for each person searching, competition for jobs between workers looks set to grow in 2024.

New recovery and lingering resilience for some sectors

Amongst job seekers, there is growing sentiment to look for a new position, combined with slower hiring this means that finding a new position will be more challenging in 2024, though we still see opportunities emerging across a variety of industries.

In the US over the last year, hiring has held up the most in the Consumer Services (+2.5%), Construction (-3.3%), and Government Administration (-3.7%) sectors. In the last six months, we have seen hiring accelerate in December compared to June in eight industries: Retail, Administrative and Support Services; Wholesale; Consumer Services; Technology, Information, and Media; Accommodation and Food Services; Government Administration; and Real Estate and Equipment Rental Service. While hiring remains down in most of these industries compared to December 2022, we have seen momentum grow in these industries since the summer. Lingering resilience in Consumer Services and Government Administration comes as no surprise given their essential role in maintaining our quality of life.

While we do not see much change on the hiring front for Hospitals and Health Care, it remains one of the strongest industries compared to historical hiring rates with hiring roughly 6% above average 2016 levels. Hospitals and Health Care historical hiring pace is only behind Construction which is recovering from a rough 2022 and historically stable industries for hiring (Government Administration, Consumer Services, Education, Utilities). According to the Bureau of Labor Statistics, healthcare added more jobs than almost any other industry in 2023.

Remote work continues to decline, as hybrid work rises

Demand for remote work continues to outstrip supply heading into 2024. According to LinkedIn’s new Global State of Remote and Hybrid Work report, availability of remote work represented 8.9% of US job postings on LinkedIn in December 2023. This is a significant drop from their April 2022 height, when they represented 20.3% of job postings. However, applications to remote roles continue to attract workers. Last month, 45.9% of job applications in the US went to remote jobs.  

While remote work continues to decline, hybrid work is becoming the new normal for many professionals. In December, hybrid jobs represented 13.1% of US job postings, and 19.8% of job applications went to hybrid positions. Even so, onsite work remains by far the most common; 51.2% of positions that members added to their profiles last month were onsite roles. From the type of positions LinkedIn members added to their LinkedIn profiles in 2023, the prevalence of onsite positions is very noticeable, with more than half of positions added in France (73.2%), India (67.5%), and the U.S. (51.2%) being onsite.

The decline of remote work is also present in other countries including the UK, France, Germany,and India with the share of remote job postings decreasing 6 percentage points in the UK, 6 percentage points in Germany, 5 percentage points in France, and 3 percentage points in India from January 2022 to December 2023.

Member Positions Added in 2023 by Workplace Type

For more insights on the state of remote and hybrid work, check out LinkedIn’s new Global State of Remote and Hybrid Work report here. Explore LinkedIn’s 2024 Jobs on the Rise list here.