Editor's Note: This report is based on survey data from May 2023 that was published in June 2023. This is the most recent data available. (Source: Bureau of Labor Statistics)

‍

Despite the national unemployment rate ticking up by three tenths of a point to 3.7% after posting a half-century low 3.4% the month before, 11 states actually saw a net decrease in their unemployment rates while the remaining states saw no significant change. In effect, the increase in unemployment was distributed relatively evenly among a majority of the states, limiting the impact on any state to non-significant levels. 

‍

Over the course of the last year, about half of all states saw little to no change in their unemployment rates. Of the remaining half, about two-thirds saw a decrease in unemployment rate whereas about one-third had their unemployment rate go up.

‍

And although nearly 340 thousand new jobs were added, only 5 states registered a meaningful increase in their payroll figures while the remaining 45 states and Washington DC were largely stable, continuing the trend of stability that has characterized the last few months with regard to these metrics.

‍

Below is the breakdown of the Bureau of Labor Statistics’ (BLS) market employment summary for June 2023.

States With the Highest Unemployment Rates

Nevada hit its fourth straight month as the state with the highest unemployment rate, holding steady at 5.4% and pausing the downward trend it had been experiencing of late.

While last month Nevada had been the only state with an unemployment rate in excess of 5%, Washington DC has now joined Nevada above the 5% unemployment threshold at a rounded 5.1%.

Over the course of the past 12 months, the states with the largest increases in unemployment rate were California, Minnesota, and DC with half a point increase each; followed by Missouri, Kansas, and Virginia at plus 0.4%; then Georgia, Iowa, and Texas, which each added 0.3% to their respective unemployment rates through the last year.

States With The Lowest Unemployment Rates

South Dakota maintained an unemployment rate of 1.9% for the second consecutive month and has now claimed the lowest unemployment rate in the country for the third month in a row. This time, however, South Dakota is joined at 1.9% unemployment by New Hampshire and North Dakota, which saw their respective unemployment rates fall by 0.1% and 0.2% last month. 

‍

11 states saw their unemployment rates decrease over the month, led by Massachusetts, Oregon, and Vermont at minus 0.3% each, followed by Hawaii, New Hampshire, Virginia, Washington, and Wyoming which each saw their unemployment rates fall by 0.2%.

‍

In total, 17 states have seen their net unemployment rate decrease over the last year, with Massachusetts out in front at minus 0.9%, followed by Maryland at minus 0.7%, then Arkansas, Mississippi, and Wisconsin, which each dropped half a point from their unemployment rates over the past 12 months. 

States With New Job Losses

No states reported statistically significant job losses last month.

States With New Job Gains

5 states saw a net increase in their payroll figures last month - California, Michigan, New York, Texas, and Utah.

‍

The largest raw job additions unsurprisingly went to the population centers, with Texas and California each adding about 50 thousand jobs while New York added about 30 thousand. 

‍

Utah had the largest percentage increase in jobs, adding half a point, followed by Texas at plus 0.4%, while California, Michigan, and New York each increased the number of jobs in their respective states by 0.3% each.

Mployer Advisor’s Take: 

While the banner headlines drawn from these employment reports often feature the unemployment rate - which book-ended the first four months of 2023 with the lowest monthly unemployment rates measured in the US since the late 1960 - in many ways the consistent, expectation-exceeding growth in the job market may be the more impressive stat.

‍

The job growth trajectory is all the more impressive in the face of not only considerable inflation at times but also the interest rate hikes that the Federal Reserve has been similarly consistent in issuing since the spring of 2022. 

‍

At its most recent meeting earlier this week, however, the Fed elected not to raise the interest rate again for the moment, perhaps a reflection of the fact that inflation has now dropped to just 4% over the past 12 month period. 

‍

Still, a majority of forecasters predict that the Fed will go ahead and raise rates by another quarter point when they reconvene in July, so the present pause is likely temporary, but if we are perhaps finally approaching the soft landing that the Fed has been steering toward, the operative question may soon become ‘when are the current rates coming back down?’

‍

To that point, Fed Chairman Jerome Powell predicts we are still a couple years away from the time when inflation will have been sufficiently contained so as to incite the Fed to begin lowering interest rates again. Economic downturn in the interim may change that timeline calculation, of course, but in that case the Fed will likely be glad to have some cushion in the interest rates to work with in the first place.

As always, this is a space worth keeping an eye on in the meantime. 

‍

Looking for more exclusive content? Check out the Mployer Advisor blog.

‍

A major highway contractor in Pennsylvania that has been accused by three former employees of illegally retaining welfare and pension benefits from hourly employees working on prevailing wage projects.

‍

In the civil case brought by three former employees regarding these allegations, the presiding judge ruled in favor of the employees earlier this month and granted their status as a class capable of bringing a class action suit. 

‍

These three former employees - Lester Packer Sr., Lester Packer Jr., and Shawn Dyroff - will now represent almost 1,500 people who are current or former employees of Glenn O. Hawbaker, Inc. that worked on similarly arranged prevailing wage projects for the company between September 1, 2012 and the end of 2018.

‍

The lawsuit was initially filed in the fall of 2021 and claimed that the defendant company violated the Employee Retirement Income Security Act and breached their fiduciary duties by neglecting to make the stipulated contributions to the employees’ benefits and retirement savings plans in accordance with the law. In fact, the allegations in this civil lawsuit are directly tied to a criminal case stemming from the same actions to which the company pleaded no-contest on multiple counts of theft and was required to pay out more than $20 million in restitution and expenses.

‍

Despite not contesting the charges of theft and agreeing to the massive pay-out, however, the company did not specifically admit to the underlying crimes being addressed in the current class action suit. 

‍

In support of finding that the class met the necessary legal requirements in size and commonality for a class action suit to proceed, the plaintiff employees pointed to the plea agreement in the original criminal case in which the company agreed to pay restitution to more than 1,200 affected current and former employees, which does not encompass the entire class of employees affected, according to the lawsuit.

‍

In addition to the current class action civil suit that Hawbaker, Inc. must defend itself in federal court against, the company is now also facing a related legal action filed by their insurance company, Twin City Fire Insurance of Hartford, Connecticut. In the insurance company’s view, the policy in question does not provide protection for losses stemming from the kinds of civil and criminal behavior that are alleged in these legal proceedings. Hawbaker of course comes at this issue from the opposite standpoint in this dispute, of course, and claims that their policy with Twin City Fire does cover circumstances like the ones presented in this case and requires the insurance company to disperse the funds accordingly. 

‍

In sum, these proceedings have serious ramifications for companies found in violation of federal law protecting employee benefit and retirement plans, and the newly verified class status of the defendants has significantly raised the stakes in terms of how much additional restitution Hawbaker may yet be on the hook for. 

‍

You can read more about this lawsuit and the potential implications it may have beyond the scope of this particular case here.

Over the last couple of years, employers have been offering more comprehensive and varied benefits packages, which has emerged as a stiff area of competition among companies competing for the same talent in the white hot labor market that emerged as hiring rebounded following the initial economic turmoil at the onset of the pandemic. 

‍

As more and more offerings have become available, however, employees have become more likely to overlook some of the potential perks and benefits package components that could be providing significant value if properly utilized. According to research from The Hartford, 70% of employers believe that employees are not effectively taking advantage of the benefits package offerings and perks that the employers are making available. 

‍

And how much value are employees leaving on the table with so many benefits flying under their radar? Estimates from the Bureau of Labor Statistics predict that employees could effectively increase their salaries by 30% if they were optimizing the benefits that are already available to them. 

‍

With so much additional compensation to be mined, employees would be wise to take another glance at their employer’s benefits offerings with a particular eye toward some of the more commonly overlooked sources of value and/or savings, including childcare and dependent care benefits, fertility benefits, commute/transit compensation, tuition contribution programs, and employee assistance programs (EAPs).

‍

According to one study, about 1 out of every 5 workers is currently managing some kind of significant caregiving responsibility between child care, senior care, special needs care, or some other kind of substantial care giving relationship. While 61% of employers offer flexible scheduling that can ease some of the pressure of juggling work and caring for a dependent, fewer than 1 in 4 companies currently offer childcare support.

‍

In the current benefits boom, however, the number of employers offering these kinds of caregiving benefits is expected to climb to more than 50% in just the next few years, so supply appears to be in the process of catching up with demand. 

‍

Some of the ways that employers are stepping in to meet these needs are by reimbursing employee expenses related to childcare, paying third–party childcare providers directly through group enrollment, or even providing in-house childcare for employees on site. 

‍

Workers who are paying for childcare - whether out of their own pockets or indirectly through their employers - may also qualify for exemptions from federal taxes up to $5,000 per year.

‍

Fertility assistance and support is another often overlooked benefit that is resulting in employees leaving substantial value on the table unclaimed. Of course, like caregiving benefits, the circumstances particular to each employee will dictate whether or not fertility benefits like IVF, surrogacy, egg freezing, and/or adoption are applicable, but employers are certainly increasing access with 8% to 10% of employers adding fertility benefits to their employee benefits packages each of the last few years, with 40% of employers now making these benefits available as of the latest data. 

Commuter perks also offer employers an opportunity to provide tax-free benefits to employees, with the IRS enabling up to $300 per year per employee to cover transportation expenses. These kinds of perks are actually mandatory in many cities and states, and employees can even expand upon the base offerings in many cases by devising their own customized arrangements that include fuel and/or maintenance expenses.

‍

Tuition reimbursement offers a similar tax-free opportunity by allowing employees to claim a maximum of $5,250 per year in educational benefits before educational receipts begin to affect federal income taxes, though workers can still qualify for further financial assistance for education expenses beyond the employer contribution.

‍

Lastly, employee assistance programs, or EAPs, are another great avenue for saving on mental health care expenses. Most programs offer a set amount of counseling sessions that are fully tax-deductible for employers and can save the employees utilizing these services the hundreds of dollars per appointment that each session would have cost out-of-pocket had the EAP not been in place.

‍

Clearly, the underutilization of benefits is causing a lot of employees to essentially forego considerable compensation that they have rightly earned through their work. While not every benefit is going to be equally relevant or available to every employee, that of course is the case with most other employee benefits too. The most important takeaway may be that each employee would be well served to thoroughly survey the available offerings and perks to ensure that they are maximizing their usage of their benefits package in light of their own personal circumstances and needs. Further, employers would be well served to encourage their employees to do so, as the positive effects from offering well-thought and comprehensive employee benefits will be curbed at least if the employees aren’t maximizing that value and fully appreciating what’s being provided.

‍

You can read more about this topic here.

With the job market as tight as it’s been over the last year plus, many companies have been getting creative and pursuing tactics that are outside their traditional methods in order to make sure all essential roles in the business workflow are adequately staffed by employees with the necessary skills to do the job well.

‍

Even before the pandemic struck, workers had been quitting their jobs at a greater rate every year since 2010, which is a trend that seems to have only accelerated now that remote work and other social factors have further inhibited deeper connections, relationships, and mutual loyalty between employees and employers.

‍

As a result, the need to fill skill gaps and the frequency of having to replace even seemingly irreplaceable workers has become a much more regular occurrence, which is why many business leaders across a variety of industries have been increasingly utilizing employee cross-training in order to minimize these issues and the impact they have on company operations.

‍

Cross-training is the process of providing additional training and experience-gaining opportunities to team members and employees that go beyond the skills and job role for which they were initially hired.

‍

While perhaps the most obvious benefit of cross-training is quickly being able to execute a necessary job function in the event that an essential team member is absent, whether temporarily or permanently, there are a great many other major advantages that companies can attain by making cross-training an integral part of their workforce development and operational strategies. 

‍

For one, cross-training is a great way to create greater flexibility and adaptability in your team, which is also helpful in recruiting and retaining the younger generations in the workforce who tend to more highly prize flexibility and mobility, even lateral, within an organization. The ability for multiple team members to be easily interchangeable among various divisions/projects/objectives also enables leaders to quickly and easily reorganize and restructure operations as needed. 

‍

Increased job-satisfaction is another advantage derived from cross-training. By investing in the development of new skills and the attainment of new experiences that are not directly tied to employees’ primary work, employers give their employees a vote of confidence that not only makes employees feel appreciated and valued, but also provides clear paths for professional development and advancement within the organization, which in turn improves retention, as well.

‍

Improved problem-solving and communication also have to be mentioned on the list of positive byproducts that can be expected from regimented cross-training. By learning new roles and the skills required to fill them, employees gain a more complete understanding about how different job functions work collectively, which helps them more clearly see the big picture. Also, when conducting new tasks, employees will naturally pick up the language and jargon required to complete the tasks involved, which in turn helps bridge communication gaps that can sometimes bog down teams that rely on more siloed skills and job functions.

‍

Perhaps the most significant advantage gained from cross-training employees, beyond all the efficiency, productivity, and satisfaction boosts, however, is the mindset of continuous improvement that it fosters, both in terms of motivating individual employees to continue their own personal and professional development, and in terms of improving processes within company workflow. Promoting and rewarding the attitude that there is always more to be learned and always a better, faster, or cheaper way to accomplish any given goal will ensure that your company’s team never gets complacent with a non-optimized status quo. 

‍

Ultimately, cross-training creates so many positive results for the company that it’s obvious why so many more companies have come to adopt more involved cross-training practices into their overall workforce management strategies. And companies that develop a reputation for cross-training can also expect the tangential benefit of attracting more adaptive, continuous-improvement-conscious talent in the first place, which will further amplify the benefits gained from the cross-training program in a positive feedback loop to the mutual benefit of employees and employers. 

‍

You can read more about this topic here.

Mark Bassett - CEO of North America for Gallagher - shared a few ideas and recommendations about the importance of talent strategy and how to develop it in a rapidly changing industry.

‍

For example, bridging the virtual divide and engaging with coworkers on a human and personal level, even when conducting meetings remotely, is an important aspect of team building that you don’t want to lose as off-site work remains a prominent work arrangement. 

‍

Leadership that is willing to acknowledge their own vulnerabilities is another important managerial evolution that better enables supervisors to relate to their employees - especially those from the younger generations - and to establish buy-in organically from the ground up. 

‍

You can read more about talent strategy in the modern market here.

Farmers Insurance has joined the growing list of companies facing significant pushback after initiating a back-to-office push.

‍

The arrival of the company’s new CEO brought with it a change to their internal remote work policy, which had previously enabled a majority of the company’s more than twenty thousand employees to work from home. The new policy would have a majority of the company’s employees in-office at least three days a week.

‍

After making the announcement, the company’s social media feed was flooded with more than 2,000 comments airing grievances about having relocated, sold vehicles, and even taken the job in the first place with the understanding that remote work would remain the policy going forward.

‍

You can read more about this policy change and the backlash to it here.