US labor market holding strong; spotlight on sustainability and green hiring

By Karin Kimbrough, Chief Economist at LinkedIn

LinkedIn data through March indicates a continued stabilization of hiring across the labor market, keeping pace with last month’s trend, although running about 10% slower than what we saw a year ago. In addition, the number of job postings on LinkedIn is also similar to last month’s level, suggesting that optimism throughout the first three months of 2024 for an economic soft landing in the US has kept these numbers aloft. We’ll be watching to see if the trend breaks down if Fed cuts are priced out of the picture.

In addition to the US labor market that’s largely been holding steady, we’ve also seen some solid gains in hiring across roles for alternative energy sources. In this month’s edition, in honor of Earth Day, we’ll take a closer look at the hiring trends we see among green jobs and green skills, and share more on the great strength we saw in hiring for green jobs throughout 2023.

US labor market performance holding steady

The US labor market still looks like the strongman of the globe. March revealed little change in key metrics such as hiring rates, job openings, and job seeking behavior. Broadly, the US pattern is one of continued rebalancing between labor demand and supply. Additionally, professionals across LinkedIn continue to be hired at relatively stable rates, with the US national hiring rate slowing 2% in the month of March, and holding at 10% slower than a year ago. 

As we observed last month, the 10% deceleration in hiring on an annual basis is an improvement over trends seen throughout 2023, suggesting that the labor market is gradually stabilizing. Overall, the US’ performance is markedly stronger now than a year ago when hiring was slowing by nearly 30% on a relatively consistent basis. Across the Atlantic, many European countries saw hiring rates in March that were, in fact, even slower than a year ago, an indication of the lingering economic lethargy in Europe. 

As an industry, Technology, Information, and Media continues to show signs of recovery following the downturn of 2022-23. Construction is also holding steady with hiring slower relative to March 2023 by about 1.5%. And, as a sign of the resilience of the American consumer, the Accommodation, Consumer Services and Retail industries also performed well in March on an annual basis. By contrast, the Finance and Administrative Services industries exhibit far less dynamism. For more details on the latest US hiring trends, check out our April Workforce Report. 

Jobs and hiring have largely held up as fears of a possible recession fade. Employers are continuing to hire (albeit with moderation), and the prime age (25-54 yrs old) US labor force participation rate now sits near its June 2023 peak. Another encouraging sign is that the number of open jobs posted on our platform, while down from its peak in April 2022, is still far above the pre-pandemic level. In general, it does appear that the worst may be behind us, though that optimism is closely tied to expectations for the Fed’s rate path.

The trends in professionals making job transitions also held steady in March. As was seen in February, the percentage change in transitions appears to be reverting to a slightly higher rate of change, though the year-on-year pace is still negative (-10%) and lies below the pre-pandemic rates. 

Hiring for green jobs outpaces overall hiring throughout 2023  

The growing commitment among countries and businesses to reduce carbon emissions has encouraged the transition to alternative energy sources, accelerated the uptake of electric vehicles, and boosted global demand by employers for a growing set of “green” skills throughout the economy. 

In fact, hiring for green jobs and skills has consistently outpaced the hiring rate for “non-green” jobs throughout most of 2023. Even in a robust labor market, the LinkedIn Hiring Rate for professionals with green skills was as much as 44% faster in the US, 30% higher in the UK, and 22% higher in France. The global green hiring rate peaked at 24% in 2023: 

The most sought-after green skills featured expertise in carbon emissions and carbon accounting, as well as in water quality, sustainability more generally, and environmental compliance. The US, UK and Germany saw the highest demand for talent with carbon emissions expertise; the UAE saw the highest demand for hazard communications and sustainable business talent; and France saw the highest demand for expertise in alternative energy sources, including wind and solar energy, and sustainable design, like permaculture.  

Despite growing demand for talent with green skills, LinkedIn data finds that supply is quite low. Green talent remains tight with only 1 in 8 workers globally having the green skills needed to drive the green transition. In order to meet this urgent need, governments, policymakers and business leaders must commit to including on-the-job training, reskilling, and upskilling.

Special thanks to teammates Danielle Kavanagh-Smith and Akash Kaura for their contributions to this newsletter.