What all the signals from the economy mean for workers
If you’re looking to the economy to strategize your career moves in 2023, you might be better off dusting off that old magic eight ball you had in middle school.
There are continued mixed signals about the health of the U.S. economy heading into the new year.
On one hand, inflation is still high and the Fed continues to raise rates to combat it, which in turn squeezes budgets for both workers and businesses. One consequence of this has been the tech industry, which has been roiled by layoffs and posted disappointing earnings.
On the other hand, the overall job market is still topping expectations by huge amounts and the economy as a whole expanded in the final months of 2022. Here’s what these mixed signals could mean for your career goals this year.
Keep a healthy emergency fund just in case
My first tip is a personal finance one. Even though many jobs are hiring today, businesses could very well pivot later in the year if the economy shows signs of impending recession. Focus on paying down debt and saving money, so you can bounce back from any bouts of unemployment.
Focus on your specific sector’s job growth
The likelihood of finding new opportunities in your field depends heavily on which sector you work in. According to Layoffs.fyi, tech companies have cut 68,149 jobs since the start of 2023. Some notable ones include Amazon laying off 18,000 employees, Microsoft letting go of 10,000 workers, and Alphabet reducing its workforce by 12,000. Although the tech sector is still hiring, workers will have to compete with thousands of colleagues who were also let go.
Don’t jump ship without asking the right questions
The national quit rate ticked up at the end of 2022, increasing to 2.7% in November where it stayed in December from 2.6% in October.
Make sure any new opportunities that you take work well with your long-term career goals and don't just jump ship for a higher paycheck. Ask questions during the interview process about the company's plans for future layoffs or how they have made adjustments and pivoted in the wake of economic challenges in the past to get a sense of what you might be walking into. If tough times are still to come, it can be reassuring to work for a firm that’s demonstrated strong leadership during downturns in the past. Ask if a severance package will be offered if you are laid off soon after joining, or if you’ll be able to keep your signing bonus.
Negotiate cash sign-on bonuses vs equity
With equity grants, you typically must wait a few years before you’re fully vested. If you get laid off before your vesting date, you’re out of luck. For that reason, consider asking for the value of the equity as a cash signing bonus instead. You’ll get a lump sum payment that you can invest now.
Don't be afraid to ask for a raise if you stay put
The beginning of the year is prime time for annual performance review conversations and compensation discussions. Don't miss an opportunity to make a case for higher pay or a promotion, especially if your duties and responsibilities have increased over the past year. The labor market is still tight and companies will want to retain their top talent.
Prepare for a rude return-to-office awakening
Despite the fact that research shows productivity improves with more remote work, business leaders still prefer to have employees in office. According to a survey of 1,000 business leaders by resumebuilder.com, 90% said they were planning on requiring workers to return to the office at least some of the time in 2023.
The good news there is that companies are offering incentives like free meals and commuter benefits to lure workers back to the office. But for many workers who have grown accustomed to the flexibility that remote work offers, it could very well be a deal breaker.
Remote roles will become fewer and further between as more companies move to fully in office or hybrid work schedules. It's going to make it harder for workers who are looking for exclusively remote roles to find those opportunities, and when they do, the competition will likely be more fierce.
Mandi Woodruff-Santos is a career coach, award-winning cohost of Brown Ambition and founder of the MandiMoney Makers, a one-of-a-kind career coaching community for women of color.
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