2024 labor forecast: 5 trends to know

The U.S. saw some positive labor trends this year, such as strong workforce participation, but it remains to be seen whether there will be a repeat in 2024, according to one new report released Nov. 15. 

The finding is from Indeed's 2024 jobs and hiring trends report, which examines demand for workers, labor force participation, quit rates and job-switching rates, wage growth, and usage of generative AI in 2023. The report also looks ahead to what labor trends could look like next year.

Five trends highlighted in the report:

1. Demand for workers has cooled. As of early November, the Indeed Job Postings Index, which tracks the percent change in Indeed job postings, is down 22.5% from its December 2021 peak. Sectors such as software development, information design and documentation, and mathematics saw the largest declines. Sectors such as restaurants, hotels and hospitals continued to see hiring demand. Based on the latest data from the Bureau of Labor Statistics, Indeed also found that after a brief rise early in 2023, the overall layoff rate as of September was just 1%, which it said would have represented a record low prior to the pandemic.

2. Workers are quitting less frequently. The latest data from the Bureau of Labor Statistics shows the nation's quit rate was 2.3% in September, equal to the average rate in 2019, Indeed found. "This slowdown in quitting is mainly attributable to declining employer demand for new hires in early 2022," Indeed said. Still, Indeed said it found that quitting is still strong by historical standards.

3. Jobs related to generative AI are surging. At the beginning of this year, 0.003% of Indeed job postings mentioned generative AI-related terms, Indeed found. This share was 0.06% by the end of October. The postings are for jobs that create generative AI tools and those that mention if the role will use a generative AI tool.

4. The labor force is growing rapidly. The labor force participation rate of workers ages 25 to 54 increased to levels not seen since the early 2000s, Indeed found, based on the latest data from the Bureau of Labor Statistics. As of October, the participation rate for these workers was 83.3%, down from a recent peak of 83.5% as of September but still comparable to rates two decades ago. "More prime-age workers may continue to join the labor force if the labor market remains tight and immigration flows stay high," Indeed said. "But don't expect these forces to hold off the shrinking effects of an aging population forever."

5. Wage growth appears to be slowing. The latest data from the Indeed Wage Tracker shows posted wages last month increased 4.2% from a year prior, were down from 4.8% in July and were well below the January 2022 peak of 9.3%. Indeed also found a slowdown in wage growth when looking at the Atlanta Fed's Wage Growth Tracker.

As far as 2024, "there's a case for optimism for 2024, but it's best not to oversell it," Indeed concluded.

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