Lucas Mautner was laid off in early May after two years of working as the senior copywriter for the global marketing team at the advertising agency Nielson. In the weeks since, while searching for another full-time job, Mautner has been supporting himself with the work he can find: freelance and part-time gigs.
“Every day that I or really anyone goes to work, it could be a layoff day,” said Mautner. “There’s no such thing as job security anymore, in my opinion—at least in my field or for white collar work.”
Since the beginning of the year, outside of a slowdown in April, job growth has dramatically outpaced expectations. Between January first and the end of April, over one million jobs were created in the United States.
But the real story is more complex as full time jobs have actually decreased this year and growth has been fueled almost entirely by part time jobs.
Month over month, full-time jobs were down in December, January, February and March, and year over year, they have been down since February. In April 2023, there were over 500,000 more full-time jobs than in April of this year.
“We look at the establishment survey and say ‘oh look there’s all this job creation,’ but when we look at the other indicators we find out that most of that job creation is actually just part-time jobs,” said Ryan McMaken, economist at the Mises Institute.
The establishment survey of employers counts someone with two part-time jobs twice. The household survey of individuals counts that person only once.
Since the beginning of 2022, the Bureau of Labor Statistics household and establishment surveys have experienced a growing discrepancy. As of April, there was a 3.6 million job gap between these two measures.
Some have attributed undocumented immigration as the leading cause of this anomaly, but an equally viable explanation is that many people who used to be working full time are now working multiple part time jobs.
In a job market where people are being laid off from full-time positions, but part-time work is abundant, then individuals who were fired are likely to take on more than one part time position to make ends meet.
Part time job growth is being driven by the strength of certain job sectors like retail and leisure and hospitality, but it is also being driven by employers preparing for hard times, according to McMaken. Indicators outside of the Bureau of Labor Statistics job reports show concerning signs, such as an inverted yield curve which has persisted for many months. An inverted yield curve means that the interest rate on long term bonds is lower than rates on short term bonds, indicating bond buyers think a recession is likely.
“By switching over from full-time to part-time labor, businesses are giving themselves the sort of flexibility that they seem to be anticipating they’ll need going forward in terms of cost cutting,” said McMaken. “And that is pointed to by the part-time, full-time situation and the general weakness in the household survey.”
Placing people into full-time positions has been a challenge recently for Elizabeth Calabrese, senior director of recruitment and delivery at the staffing agency Creative Circle.
Since last October, far fewer companies have been directly hiring individuals for full-time, salaried jobs through Creative Circle, but there has been a major influx of part-time contractors approaching the staffing agency. The majority of roles Calabrese can place people into through Creative Circle are short-term, hourly wage positions.
“Everyone is struggling right now,” said Calabrese. “People have been out of work for a couple of months, or they’re just not getting consistent work, or they’re taking on jobs at lower pay rates than what they’re used to.”
Calabrese’s experience captures a slice of what many Americans across the country are going through, but the labor market at the moment is indeed very strong on the whole. Unemployment has been below 4% for 27 months in a row, and the number of job openings in general remains high.
Inflation dropped and remains steady between 3 and 4 percent even as the labor market continues adding hundreds of thousands of jobs and wages increase, a remarkable phenomenon which the Biden administration likes to emphasize.
“The string of months where the nation’s unemployment rate has been below 4% has been historic—the longest stretch since the 1960s. We’ve been seeing moderation in hiring but still at a good level. Demand for labor continues to outstrip supply, and we have roughly 1.3 job openings for every individual,” said Mark Hamrick, Washington bureau chief and senior economist at Bankrate.
This rosy picture of the job market is accurate from a macro perspective, but it does not reflect the lived experience of being laid off and struggling to find a comparable job.
Mautner, the copywriter laid off earlier this month, would take on supplementary jobs while working for Nielson, but losing his primary position and source of income has left him in a precarious position. A general sense of job insecurity led Mautner to make sure he maintained relationships with freelance employers, which he is happy paid off. But now, the challenge is getting that next full time role.
“I’ll send my resume out to a bunch of places, and then I’ll get a call back from maybe 1% of those,” said Mautner. “And I’m not a rinky-dink candidate. I’ve worked for very big blue-chip companies, and I’m not applying for jobs that are a stretch.”
There has recently been a noted disconnect between people’s feelings about the economy and what the data portrays, which has been dubbed a “vibecession” by commentator Kyla Scanlon and popularized by economists like Paul Krugman.
Instead of acknowledging people’s struggle, the term relegates their negative feelings to the realm of illogical “vibes,” but for people like Mautner, those feelings are certainly logical.
The disconnect between positive reports on the job market and the experience of thousands of full-time workers over the last few months has the potential to cause disillusionment for voters as the Biden administration tries to emphasize the strength of the job market and the economy as a whole in the leadup to November’s elections.
