Labour market: employers regain control over employees

Growth is slowing and the labor market is now tilting in favor of employers. Business owners may be finding it easier to recruit, but they still lack visibility on their order books.

Fewer labour shortages

By the end of 2022, the French Ministry of Labor counted over 364,000 job vacancies in the private sector, an increase of 72% compared to the end of 2019. Companies were particularly hard-pressed to recruit at a time when the unemployment rate had reached its lowest level (7.2%) since 2008. To attract candidates, the sector's players had to redouble their efforts, highlighting, for example, the provision of a company car or the payment of a sponsorship bonus in their job offers.

The situation has changed this year. Indeed, business leaders are talking less about labor shortages. In an interview with Les Echos newspaper, Roland Gomez, CEO of Proman, Europe's 4th-largest temporary employment agency, points out that the main concern of managers is now " the vagueness of their workload plans ".

Many are also wondering how to organize their work. It has to be said that Covid-19 has revolutionized employee habits: 100% telecommuting, an à la carte system, face-to-face work... It's up to employers to decide as the new school year approaches.

Impact on wages

While the balance tipped in favor of employees last year, this will probably not be the case in 2023. Against a backdrop of slowing economic growth, the negotiations are unlikely to result in significant wage increases.

" In principle, and barring any bad figures on price rises at the start of the new school year, the review clauses will come to nothing," reports an industry executive.

However, the situation on the job market differs from one sector to another. In industry, for example, labor shortages are still being felt.

" Physically arduous and poorly paid jobs in construction, security, cleaning, or those with long working hours like the hotel and restaurant trade, remain unattractive," confirms Roland Gomez to Les Echos.

The construction sector is also concerned, despite the crisis in housing construction. In the events sector, with the Olympic Games scheduled for 2024, recruiters have anticipated by offering more attractive salaries and a long-term commitment.

To convince future employees to choose their company, managers have several levers at their disposal:

  • remuneration,
  • working conditions,
  • the management model,
  • and the meaning of the work proposed.

More and more companies are focusing on working conditions (especially teleworking) to keep up with the competition.