According to the latest data from Layoffs.fyi, over 24,000 workers from 93 companies have lost their jobs so far in 2024. In addition, recent data from Glassdoor, employee confidence has fallen to its lowest level since 2016. Can the labor market bounce back from layoffs and recent pessimism?
Glassdoor Lead Economist Daniel Zhao joins Yahoo Finance to discuss the health of the labor market and what future jobs data could spell for 2024.
"The hiring rate has come down really significantly in the latest JOLTS data and that's basically at its lowest pre-pandemic level since 2014, so hiring has really come down even though layoffs haven't really increased as much as the headlines might imply, and I think that's actually creating a bit of lock-in," Zhao says. "We talk about lock-in in the... housing sector, but for the job market, we're seeing a lot less hiring, a lot less voluntary turnover as people quit less, and there are people who are hunkering down in a bit of a holding pattern for their careers."
For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.
SEANA SMTH: Over 20,000 tech workers have lost their jobs so far this year. That's according to the latest data out from layoffs.fyi. Now, the latest cuts coming from iRobot here today just this morning announcing that it's going to cut about 31% of its staff. Glassdoor data showing a recent spike in layoffs is hurting employee confidence. That falling to its lowest level since 2016. So where does the labor market stand?
We want to bring in Daniel Zhao. He's Glassdoor's chief economist. Daniel, it's great to have you back here in studio with us here. So how did the jobs report that we're going to get on Friday-- the last several reports have really proven the fact or really signaled that the labor market has stayed resilient, yet we keep getting these types of headlines specifically within the tech sector that they're losing jobs and they're continuing to lay off workers. What's going on? What's the reason for that?
DANIEL ZHAO: Well, so I think it's interesting because we say that the job market has been resilient over the last year. And that's absolutely true, but it definitely has slowed. The hiring rate has come down pretty significantly. And then even though measured layoffs are still fairly low, clearly it is something that workers are concerned about. That's why we see employee confidence coming down. And that's why people are still concerned, even though the hard data is showing that the job market is still relatively stable.
BRAD SMITH: And so for those who are now in the midst or caught up in these layoffs, now, are there enough positions for them to get back into or to enter into elsewhere? And where is some of that rotation happening?
DANIEL ZHAO: Well, I think that's a great question because the hiring rate has come down really significantly in the latest JOLTS data. And that's basically at its lowest pre-pandemic level since 2014. So hiring has really come down even though layoffs haven't really increased as much as the headlines might imply. And I think that's actually creating a bit of lock-in. We talk about lock-in the mortgage-- or in the housing sector, rather. But for the job market, we're seeing a lot less hiring, we're seeing a lot less voluntary turnover as people quit less, and there are a lot of people who are kind of hunkering down and in a bit of a holding pattern for their careers.
SEANA SMTH: Daniel, we're getting headlines out it. Seemed like that conversation had died down about this push and the return to office but bank of America, one of the latest from Wall Street really cracking down on the knee that employees need to come back a certain number of days a week. What do you think that's going to do to the jobs market, to the jobs picture here in the next few months?
DANIEL ZHAO: Well I think it's really a signal of the fact that employers are getting more power, right? So over the last year or two, the balance of power has shifted back towards employers. That means that they can more aggressively pursue these return-to-office plans. And quite frankly, it's still up in the air how exactly that's going to turn out, whether employees are really going to acquiesce to this or employers are going to have to push even harder.
BRAD SMITH: And so as we're staring down this week's jobs report, what do you believe the data is going to tell us about the health of the labor market right now?
DANIEL ZHAO: Well, I think the job market was resilient through much of 2023. And that is still probably the picture we're going to get in 2024. I don't think we're going to see, really, this latest wave of layoffs really affect the numbers very much. But I think that we are going to see some softening. We are going to see that the jobs growth slow down a little bit more. And also we're getting a lot of revisions in this report with benchmark update and that sort of thing. And I think overall, it's going to show that 2023 was maybe a little bit cooler than we had originally thought.
SEANA SMTH: Daniel, when we talk about so many of these headlines involving tech companies here, is that going to be the theme when you look out to the rest of 2024?
DANIEL ZHAO: I guess it depends on what the theme for what, right?
SEANA SMTH: Layoffs. Yeah.
DANIEL ZHAO: For layoffs, I think-- I think we are still going to see a lot of tech companies try to cut costs and continue this year of efficiency mantra from 2023 into the new year. That being said, I think that a year is a long time. It's not really certain what exactly we're going to see in the new year. On the flip side, the industries that were hiring last year I do expect to continue to add jobs in the new year. That's health care, education, government. Those sectors I do expect to continue to grow in the new year.
