The job market begins 2023 in a very different place than it was a year ago. At the beginning of 2022, the main issue plaguing the market was disruption caused by the COVID-19 Omicron variant. Now, although the COVID-19 pandemic still lingers, inflation and rising rates represent the main threat. Fortunately, the job market proved stubbornly resistant to these economic headwinds last year as job growth and employment levels held strong into the fourth quarter. But now as we enter 2023, it’s unclear whether these conditions will last or soon take a turn for the worse.
In order to get a better understanding of the current job market and what 2023 will have in store, we surveyed more than 30,000 job seekers from across the country over the past three months. How do job seekers feel about their job security and future prospects in this uncertain economic environment? Will the Great Resignation lose steam in 2023? How is inflation impacting views on pay? To what extent are job seekers still excited about remote work? And what is really causing recent productivity declines among American workers? Read on for a detailed breakdown of the key trends that are shaping the U.S. job market in 2023.
It’s still a job seeker’s market (for now). The majority of job seekers (52%) say that they — and not employers — have the upper hand in today’s job market. Case in point: 78% of job seekers believe that they can make more money by switching jobs rather than staying put.
No end in sight for the Great Resignation. One-quarter of Joblist users quit a job in 2022, and the main reason for quitting — given by 39% of those who quit — was bad management or a toxic workplace. Although the Great Resignation has slowed in recent months, it appears far from over. In our survey, 67% of employed job seekers report that they are planning to quit their job in 2023. Of those planning to quit, 34% say that they would be comfortable leaving their job without a new one lined up.
Layoff concerns are very real, especially in tech. Overall, roughly one-in-four workers (26%) are worried about their job security, 34% work at a company that is currently in a hiring freeze, and 14% say their employer has already announced or made layoffs. Across all industry groups, tech workers are the most concerned about losing their job (22% are “very worried”), while educators are by far the least concerned (63% are “not at all worried”). Meanwhile, healthcare and education workers are the most likely to say that their employers are still hiring (79% and 75%, respectively).
Pay is not keeping up with inflation. As we enter 2023, only 50% of job seekers report being happy with their current pay, while even fewer (45%) say that they feel financially comfortable. Although 53% of workers received a raise in 2022, those raises tended to be small. In total, 89% of raises were less than 10%, and 65% were less than 5%. Of those workers who asked for a raise, only 59% ended up receiving one; the top reason why workers asked for a raise was inflation and cost-of-living increases (cited by 65% of those who asked for a raise).
Workers are split along generational lines on remote vs. in-person vs. hybrid work. For 2023, 36% of job seekers are looking for a fully remote role, 44% want an in-person position, and 19% prefer a hybrid role. Many more Millennials (49%) would like a fully remote job than Gen Zers (27%), who tend to be much more likely than average to be seeking in-person opportunities (57%). Of job seekers working remotely at least some of the time, 43% say they would quit if they had to start working in person full-time in 2023.
Employers must do more to address burnout. Half of workers say that they are currently burned out, and most are pessimistic about their employer’s ability to help address the problem. In fact, 62% of workers say that their employer is not doing enough to minimize burnout, while 52% believe that their employer does not care about their well-being and 73% do not see any significant growth opportunities at their company. Interestingly, job seekers working in person reported lower rates of burnout than those working remotely (48% compared to 55%).
Will the job market finally cool in 2023? 35% of job seekers predict it will be harder to find a job in 2023 than in 2022. Recession fears seem to be a big reason why — 69% of job seekers now expect the U.S. to enter a recession in the next year, and 47% report being “concerned” or “very concerned” that this will negatively impact their job prospects in 2023.
The Big Picture
Despite growing economic concerns due to inflation and high interest rates, the majority of job seekers are actually feeling good about their position in the job market entering 2023. In our survey of thousands of Joblist users, a significant share think their job prospects are better now than a year ago. However, uncertainty and recession fears still loom for many.
Many have speculated that the power dynamic is starting to shift back in favor of employers amidst news of mass layoffs and hiring freezes at prominent companies. However, in our survey, over half of job seekers (52%) believe that they still have the upper hand in the current job market. Across generational lines, Baby Boomers are the most likely to think that job seekers have the upper hand (57%), while Gen Xers are the least likely (49%).
More job seekers than not also believe that their employment outlook has improved in the last 12 months. In our survey, 33% of job seekers think their job prospects are better now than they were a year ago, 21% think they are worse, and 47% think they are the same. Millennials skew more pessimistic — 25% think their job prospects are better now, and 30% think they are worse. On the other hand, Gen Zers are more optimistic on average, as 42% think their job prospects are better while 28% think they are worse.
Looking ahead to 2023, our study shows that job seekers predict that the job market will be slightly more challenging this year, but not by much more. According to our survey, 35% of job seekers think it will be harder to find a job in 2023 (up from 29% last year), 25% think it will be easier (down from 37% last year), and 40% think it will be the same (up from 34% last year). At 43%, Millennials are the most likely group to think it will be harder to find a new job in 2023.
Despite a somewhat positive outlook overall, nearly half of all job seekers (47%) have some level of concern about a potential recession in 2023 impacting their job security or ability to find a new job. Over one-in-four job seekers report being “very concerned” about a recession, while another 21% of job seekers are not concerned. Again, Millennials tend to be more concerned than average — 53% are “concerned” or “very concerned” about a potential recession impacting their job situations (versus 47% across all generations).
Overall, the current job market remains strong for most job seekers. However, survey results indicate that there is a growing level of concern about a potential recession and worsening job market in 2023, particularly among Millennials. The generational differences are striking, and also understandable. At their mid-career stage, Millennials likely have more financial responsibilities than Gen Zers and less job security and stability than older generations. In addition, Millennials may have some specific scar tissue from entering the job market during or after the 2008 financial crisis, leading to more skepticism and concern in the current environment.
The Great Resignation
While the Great Resignation rolled on in 2022, it is slowly losing some steam. According to data from the Bureau of Labor Statistics, over 42 million Americans quit their jobs through the first 10 months of the year. However, the number of monthly quits has been trending downward since April, as quitters face a changing employment landscape, with many firms actively laying off workers or hesitant to hire due to economic uncertainty.
In a recent survey of Joblist users, one-quarter quit a job in 2022. The most common reason for quitting — given by 39% of those who quit — was bad management or a toxic workplace. A meaningful percentage also quit due to low pay (26%), limited growth opportunities at work (17%), burnout (17%), lack of schedule flexibility (12%), or inadequate benefits (9%). More than one-in-three (35%) quit their job without having a new job lined up.
Of workers who quit a job in 2022, our study finds that more than one-fifth (22%) regret their decision to quit. The number one reason that people regret their decision to quit is that it was harder to find a new job than expected (49%). In addition, 13% also report that they regret quitting because the economy worsened after they quit. These results suggest that shifting economic conditions may indeed be to blame for some quitters’ remorse.
One-fifth of job seekers also regret quitting because their new job was not what they had hoped. Job seekers less commonly report that they regret quitting because they miss the people at their old job (14%), the old job was better than they realized (13%), and work-life balance declined at their new job (7%). Unfortunately, the grass is not always greener.
Even as the Great Resignation has slowed amidst heightened economic uncertainty, it appears highly unlikely that this phenomenon will screech to a halt in 2023. In fact, our survey results show that two out of three job seekers on Joblist are planning on quitting their jobs in the next 12 months. Of those planning to quit next year, 34% would be comfortable quitting without a new job lined up — a figure slightly higher than a year ago (32%).
While the most common overall reason that job seekers are planning to quit in 2023 is for better pay or benefits (45%), reasons for wanting to quit vary significantly by age. Gen Zers are the most likely to cite higher pay (73%) and a desire for more schedule flexibility (21%) as the reasons they plan to quit. Meanwhile, Millennials most commonly point to limited growth and advancement opportunities at work (37%), and Gen Xers most frequently mention bad management or a toxic workplace (35%).
Layoffs & Hiring Freezes
News of layoffs and hiring freezes became more and more common in the latter half of 2022 as recession fears set in. Many tech companies, in particular, tightened their belts and reduced their workforces by laying off more than 120,000 workers last year. In all likelihood, this will continue to be a major story in 2023 as well.
Overall, more than one-in-four workers in our survey say that they are worried about their job security. Ten percent report that they are “worried” and 16% are “very worried.” At the same time, 47% of workers are “not at all worried.” This shows a significant bifurcation among workers when it comes to job security concerns, which largely depend on individual circumstances.
Concerns about job security vary greatly by industry. Hospitality and tech workers are the most worried — 21% of hospitality workers and 22% of tech workers report feeling “very worried” about their job security. In contrast, retail and education workers feel much more secure. Just 11% of retail workers are “very worried” about job security, while 63% of education workers are “not at all worried.” Unsurprisingly, among those workers whose employers have announced recent layoffs, 40% are “very worried” about their job security.
Our survey results show that over one-third of respondents (37%) work for a company that is currently in a hiring freeze, and 14% work for one that has made or announced layoffs. Hiring freezes are most common among Joblist users in the tech industry (53%), while healthcare and education workers more commonly report that their employers are still hiring (79% and 75%, respectively). One-quarter of tech workers and slightly less than one-fifth of hospitality and retail workers also say that their employers have made or announced layoffs recently.
Looking ahead to 2023, nearly one-in-four workers in our survey think that their companies will reduce headcount in the next 12 months. An almost identical share believes their companies will grow, while about half think their companies will stay the same size. Healthcare, retail, and tech workers are the most likely to predict that their company size will shrink (27-29%), and education workers are the least likely (15%).
Despite the increase in layoff and hiring freeze announcements, the majority of employed job seekers feel confident about their job prospects. In fact, 52% of job seekers are confident (with one-third being “very confident”) that they can get an equally good job in the current job market, and just 11% are “not at all confident.” Even in tech, where job security concerns are the highest, 40% of tech workers report being “very confident” that they could get an equally good job in the current job market. Although the job market has clearly cooled in certain industries, it is still far from dire.
Inflation reached a 40-year high this summer, peaking at 9% year-over-year in June. Workers are feeling the sting of high prices, and wages are not keeping pace. Bureau of Labor Statistics data shows that while average hourly earnings have been rising steadily throughout the year, they are just 5% higher than a year ago.
In this age of sky-high inflation, our study finds that only half of job seekers are happy with their current salaries, and 45% report feeling financially comfortable. Older job seekers (Baby Boomers and Gen Xers) are the most likely to say they are happy with their current salaries (56% and 54%, respectively), while the majority of Millennials report being unhappy (just 38% say they are happy). At 42%, a slightly larger share of Gen Zers are happy with their salaries. Older job seekers are also more likely to say they feel financially comfortable with their salaries (55% of Baby Boomers and 50% of Gen Xers) compared to Millennials and Gen Xers (both 35%). Unsurprisingly, job seekers who are unhappy with their salaries are more likely to have asked for a raise in the last year than those who are happy (43% compared to 32%) and less likely to have received raises (42% compared to 65%).
Our survey results show that 38% of employed job seekers asked for a raise in the last 12 months, and more than half (53%) of employed job seekers received one. While Millennials are the most likely to have asked for a raise (44%), Gen Xers are the most likely to have received one (61%). Among those job seekers who asked for a raise, only 59% received one. However, half of job seekers who didn’t ask for a raise received one anyway.
Cost-of-living increases are at the top of many job seekers’ minds when asking for a raise. Nearly two-thirds report that they asked for a raise due to inflation, while nearly half say that they asked for more money because they had taken on more responsibilities at work — a common occurrence due to high coworker attrition during the pandemic. In addition, 41% sought a raise due to good performance at work, while one-quarter did so because they felt underpaid. Some job seekers (17%) asked for a raise simply because it had been a while since their last one, and just 7% asked for more pay because they had a higher outside offer.
Our study indicates some differences between genders and age groups when comparing the specific reasons that workers asked for a raise. Men are more likely than women to have asked for a raise due to good performance and because it had been a while since their last raise. Millennials are more likely than other generations to have asked for a raise due to inflation, good performance, and feeling underpaid.
While more than half of employed job seekers received raises in 2022, these raises tended to be small. In total, 89% of raises were less than 10%, and 65% were less than 5%. Even among those who received raises in 2022, those raises were less than the inflation rate, resulting in a decline in real wages.
Looking ahead, we find that job seekers are evenly split on whether they expect a raise in 2023 if they stay with the same company. However, about two-thirds of job seekers who received a raise in 2022 think they will get another raise in 2023 (compared to just 34% of job seekers who did not receive a raise last year).
It has been nearly three years since the beginning of the pandemic when the remote work revolution began. Interest in both remote and hybrid jobs remains high, but working from home is not for everyone. According to our survey, job seekers are split on their work setting preferences for 2023, with interesting results when comparing across generations.
While the majority of job seekers are looking for a job where they can work remotely at least some of the time in 2023, preferences vary by age. Overall, 36% of job seekers are looking for a fully remote role for this year, 44% want an in-person position, and 19% prefer a hybrid role. Nearly half of Millennials would like a fully remote job, nearly twice the share of Gen Zers, who mostly want in-person jobs (57%). Interestingly, the same share of self-identified introverts and extroverts want an in-person job (41%), but slightly more introverts prefer a remote job (41% compared to 36%).
Our study finds that a significant share of employed job seekers are working remotely at least some of the time already, and many would quit if required to work fully in person in 2023. Overall, 39% of employed job seekers are currently working remotely for all or some of the time; this share does not vary much by generation or personality type. Of the job seekers working remotely at least some of the time, 43% say they would quit if they had to start working fully in person in 2023. This viewpoint was most common among Gen Zers (53%) and introverts (45% compared to 40% of extroverts).
Usage of tracking software by employers to monitor remote work has become increasingly common and is another new trend to monitor in 2023. Nearly half of those who work remotely at least part of the time report that their companies use tracking software, and another 17% are not sure. However, contrary to what some might expect, nearly three-quarters of remote workers do not mind tracking software; only 26% say that they would not work for a company that used it in the future.
American workers are getting less done. In the first half of 2022, productivity declined by the sharpest rate on record, according to data from the Bureau of Labor Statistics, and then fell again year-over-year in the third quarter. After productivity soared in the early days of the pandemic with the sudden shift to remote work, there has been much conversation about what is causing such a swift productivity reversal over the last year.
Based on our survey, worker burnout could be a big reason for recent productivity declines. Half of all workers report that they are experiencing burnout right now. The most common reasons cited by workers for their burnout are a lack of recognition by their employer (46%), limited growth opportunities at work (46%), and a toxic work environment (41%). Workers also report feeling burned out due to being bored or tired of doing their jobs (29%), working long hours (26%), and having unrealistic deadlines or expectations (21%). Job seekers less frequently cite stress outside of work (16%) and a limited connection with coworkers (11%) as the main drivers of burnout.
Although burnout is high overall, those working in person report lower rates of burnout than those working remotely (48% compared to 55%). This runs counter to one narrative that the flexibility and freedom of remote work reduces burnout. While this may be true for some, many remote workers are clearly still struggling. However, it’s important to note that burnout among in-person workers also remains quite common, and in-person workers are more likely to say their burnout is due to a toxic work environment (46% compared to 30% of remote workers).
According to workers, employers need to do more to address burnout. In our survey, 62% of workers think that their employers are not doing enough to minimize burnout, and among workers who feel burned out, 78% feel that their employers are not doing enough. In addition, one-quarter of survey respondents rate their employers as doing a “poor job” of monitoring and addressing burnout, while only 20% think their employers are doing an “excellent job.”
The majority of workers in our survey feel undervalued by their employers. In fact, 52% of all workers (and two-thirds of those who are burned out) believe that their employers do not care about their well-being. Meanwhile, 73% say that they do not see significant growth opportunities at their current company.
When workers feel so deeply underappreciated like this, it’s naturally demotivating. Combined with the cumulative effect of a stressful multi-year pandemic and current economic uncertainty, it’s no wonder that worker productivity has hit a lull recently. Based on our survey results, the trend seems likely to continue in 2023.
Job Seeker Confidence
While other parts of the economy — particularly the housing market — have slowed down recently, the labor market has continued to defy expectations. Hiring has tapered only slightly in recent months, as the economy added over half a million jobs in October and November, and the unemployment rate stands just a notch above the pre-pandemic low of 3.5%.
As recession fears rose in the late summer and fall, the Joblist Job Seeker Confidence Index — our measure of how job seekers feel about the job market each month — fell steadily, landing at its lowest level since early 2021. However, job seeker confidence has bounced back since October.
Job seeker expectations improved over the fourth quarter of 2022. In October, 20% of job seekers thought the job market would get worse in the next month, while 27% thought it would improve. By December, the share who thought it would get worse dropped to 17%, and the share who believed it would improve rose to 31%.
At the same time, the share of job seekers who view the job market as “easy” increased slightly over the quarter, from 15% in October to 17% in November and 18% in December. The estimated time to find a new position varied over the quarter, but not by much. As was the case earlier in the year, the vast majority of job seekers still do not think it will take long to find a new position. In October and November, 80% of job seekers thought it would take two months or less to find a new job; by December, this figure had increased to 83%.