The job market is holding strong despite ongoing concerns of a recession.
There were 11.3 million job openings in May, or roughly two jobs for every unemployed worker, according to the latest Job Openings and Labor Turnover Survey. Some 6.5 million people were hired into new jobs, and 4.3 million people quit for a new one. May marked six straight months of more than 11 million job openings, and 12 straight months of more than 4 million people voluntarily leaving their job.
The strong labor market stands in stark contrast against growing recession fears — 70% of Americans believe an economic downturn is on its way, driven by concerns over high inflation, rising housing prices and a volatile stock market, according to one MagnifyMoney survey.
So is it a good time or a bad time to change jobs? Here's what economists say.
There's still an 'insatiable demand to hire'
It's still a job-seeker's market and employers have an "insatiable demand to hire," says Andrew Flowers, a labor economist at Appcast and research director at Recruitonomics. As of June, he says Appcast, which helps businesses with recruiting efforts, hasn't seen a slowdown in employers' intent to hire through the end of the year.
Current job postings are 61% higher than they were pre-Covid, according to Bureau of Labor Statistics data.
Flowers expects jobs in leisure and hospitality to remain strong as people continue to travel, go to events, dine at restaurants and shop, even as inflation has ratcheted up in recent months.
But some jobs may be more sensitive to the rising interest rate, including in construction and manufacturing, which could see a drop-off in openings.
As for people who are seeing opportunities in their field right now, Flowers says to "strike while the iron is hot."
But job-seekers should be cautious and prepared
Still, others warn that growing uncertainty is a reminder to be "cautious" about changing jobs, and to make sure you have a new one lined up before you quit.
"It doesn't mean workers can no longer look for better opportunities, but I would hesitate to leave a job if I had no immediate prospects," says Stephanie Aaronson, vice president and director of the Economic Studies program at the Brookings Institution.
The best thing you can do, she says, is to do some "on-the-job" searching to "make the exchange without a spell of unemployment. Your odds of finding a new job are still quite high, and there's still a potential payoff to doing that."
In the first quarter of 2022, job-switchers saw their pay grow by 8.7% year-over-year, while wages for job-holders went up by 6%, according to ADP data.
Aaronson adds that job-seekers should "be prepared" to put in the effort in interviews, more so than you might expect given stories of hiring managers fighting for talent in the last year.
If hiring cools, it won't be "enough to show up and be available to work," she says. "Firms are going to be hiring a lot fewer people, so there's going to be more competition, and you'll have to make yourself a more attractive candidate."
Some firms (particularly in the crypto space) have gone to the extreme in recent months by rescinding job offers days before new hires are set to start.
However, the move is "highly unusual" and primarily coming from hyper-growth tech companies focused on nixing early-career jobs, says Sid Upadhyay, co-founder and CEO of the hiring platform WizeHire. Still, it's another reminder that job-seekers should assess their risk tolerance for changing jobs given their financial circumstances, and do their due diligence about a prospective company.
A recession may not have a big impact on the job market
Some experts warn that if the U.S. enters a recession, recent hires could be the first to be fired if the company undergoes layoffs.
Others say if we do enter a recession, the market could be slower to respond due to today's sheer demand for labor. Many employers haven't been able to staff up during the Covid recovery, and "you can't lay off what you don't have," says Ron Hetrick, a senior economist at the labor market analytics firm Lightcast.
Overall, Flowers says the most likely immediate change in the job market is that workers will lose some negotiating power, "but that doesn't mean layoffs are coming en masse."
Why you should pay attention to the quitting rate
To get a temperature check on how people feel about their own security in the broader economy, Flowers says the big indicator he's paying attention to is the quits rate, which has remained at or near a record-high of 3% for the last year.
"The quits rate is putting money where your mouth is," Flowers says. "If you think the economy is strong and you can get a better offer, you'll do it. But when quits decline and people are more conservative [about leaving their job], that'll tell me consumers are shifting their confidence in the economy."
Check out:
'It's almost unbelievable': People are having their job offers rescinded days before they start
88% of execs think they've made great leadership decisions during Covid—only 53% of workers agree
Despite high-profile staff cuts, the job market remains 'burning hot' for workers
Sign up now: Get smarter about your money and career with our weekly newsletter
