July 18, 2024
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ECONOMY INFLATION

How Inflation Is Reshaping the Job Market for New Entrants

How Inflation Is Reshaping the Job Market for New Entrants

As you enter the workforce, there are myriad challenges and strategies to navigate — particularly around finding a job in the first place. Inflation rates only complicate this intricate dance you are doing to land a career as a recent graduate or new professional on the scene. Whether you’re sure or unsure about your career path, there are plenty of opportunities to be found in the current job market. Although the rate of rising prices changes things a bit, there are ways to be savvy about the system and land the job of your dreams.

The Current State of Inflation and Wages

There always seems to be a debate over whether or not wages are keeping up with inflation. However, it’s not always a clear-cut answer. The Consumer Price Index (CPI) reports the average change in U.S. pricing for common goods and services such as utilities, food, and gas. As of April 2024, there was a 3.4% annual increase in the cost of these items across the board. During the same period, though, wages have increased by about 4.4%. This would suggest that workers are being paid more than enough to keep up with rising costs of living. However…

Considerations

This doesn’t paint the whole picture. You must account for the inflation cycleor the rate at which inflation occurs. If wages aren’t keeping up, there are gaps in time when the prices of necessary items will be too high for your current pay to cover.

Further, it’s important to note that unemployment rates and the rates of part-time versus full-time work may be higher. With fewer people employed full-time, there may be more, higher-paid employees making up the average wages. This also calls into question the amount of jobs being created. Overall, nonfarm payroll additions increased by 175,000 in April 2024. While this sounds like a significant hiring boost, it’s the lowest number in half a year.

Inflation Effects on the Job Market for Budding Professionals

You can also dissect the number of jobs created by sector. For instance, healthcare topped the charts by adding around 56,000 new workers in March of 2024. Many advisors and online resources for job seekers recommend finding inflation-proof careers. However, job experts are skeptical that such career industries exist. While certain sectors like healthcare persevere through hard times, like the pandemic, it is difficult to predict what industries will flourish or decline overall.

It can be safer to embark on a career path in a reportedly inflation-proof industry, but you may run into even more competition that way. New grads and professionals are already vying for the same positions. If times are tough, more seasoned professionals may even opt for entry-level opportunities, presenting more competition. In any case, it’s best to focus on bettering your skills and marketability to employers rather than trying to evade the inevitable effects of inflation altogether.

How To Distinguish Yourself in a Tough Job Market

With rising costs, it may feel scary to wait around for the best job offer to turn up. Even though you can’t predict the future, you can prepare for it. Consider adapting your skills or upskilling to open up viable career options for yourself. For instance, the market for those working in skilled trades is on the rise. This is due to tech advancements in fields like construction calling for specialized professionals. New tech opens up careers in emerging fields and positions that haven’t existed before. There is also a demand for skilled labor professionals as the aging population enters retirement. Learning specialized skills in emerging or in-demand fields like this can offer stability and growth potential amidst economic uncertainty.

When applying for your first job in an inflationary economy, you may feel discouraged at the lack of open or viable positions. There may be record numbers of job applicants applying at the same time. However, you can boost your application game to distinguish yourself from the pack. Here are some strategies to consider:

  • Applying while still in school;
  • Gaining experience via related internships;
  • Networking to ensure solid references;
  • Designing a brief, impactful resume;
  • Personalizing your cover letter per job application;
  • Getting a professional headshot for LinkedIn;
  • If applicable, creating an online portfolio of your best work from school, personal projects, or previous experience.

Many employers will automatically reject applications that don’t follow the instructions outlined in the job posting. Read everything carefully, and take your time applying and personalizing your application to the specific job. It’s also important to remember that you can apply to as many jobs as you’d like. This only increases your chances of getting an offer, and the application and interview practice is helpful along the way.

Adapting to a Changing Economy

As inflation continues to reshape the job market, make sure you are reshaping how you think about your career path. New entrants will face a complex landscape of increased competition and fast-paced changes in job requirements.

By balancing rising prices with prospective employment opportunities, you can remain adaptable and make strategic choices. It’s important to keep an eye on the misery index — a composite measure of inflation and unemployment rates. Use the information you glean as fuel to work harder to differentiate yourself and continuously seek growth opportunities.

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