Every business runs on one asset more than any other - people. The success of a company depends very highly on who is working to achieve that success as well as how professional, passionate, and happy in their workplace they are. Therefore, everyone, from HR managers and company heads to investors, looks at the new trends in jobs when deciding what they have to do in order to advance their goals. Here is where labor market analytics can be of much assistance. It is the set of tools and techniques that uncovers important insights about the current status of the labor market and where it is headed.
How to conduct an excellent labor market research
Labor market analytics, as all similar types of research, begin with data. In order to conduct a high-quality analysis one first needs to gather or acquire the relevant data for it.
There are many data types that might be of relevance in labor market research. First and foremost, it is, of course, the data that is directly related with employment and job trends. However, even seemingly unrelated data that define broader market conditions might be crucial for particular research designs and approaches to market analytics.
Below are some examples of the data points that should be collected when performing labor market analysis. Naturally, the list is not extensive and many other alternative data types are valuable for such research.
- Job postings data. Online job postings information is crucial to uncovering employment trends. This type of data shows what positions are in the market and what types of skills are sought after. Additionally, it indicates growth or decline in employment rates for particular industries.
- Employee satisfaction data. Information about how employees in particular industries and companies are feeling about their positions is extremely useful to determine key factors that lead to job satisfaction. Anonymous employer review data is especially useful for this purpose.
- Growth firmographics. This is the data that shows the growth trends of the company. It allows to both directly see changes in employment, as well as predict future shifts.
- Company funding data. Another useful data type to determine what companies and industries are going to higher more is looking at where the funding is going. Naturally, many firms will invest additional funds into growth, including opening up new job positions.
Next to these fundament examples, there are various data that can lead to labor market changes. Thus, even social media trends or important social and political events produce data that can be used for labor market analytics.
Next important question is how to gather such data. A lot of information for labor market analysis comes from surveying both the employers and the employees. Surveys can reveal what both sides expect of each other as well as provide insight into their future plans regarding what sort of jobs are going to be offered and what kind of offers are more likely to be taken.
However, surveying takes a lot of time and is quite expensive to conduct. Many companies that want to benefit from labor market analytics need to use the online data gathering tools. Scraping the web for alternative data related to job market trends allows gathering more information faster. Of course, not all companies do it themselves. Many turn to specialized data providers to get the information they need for labor market analysis.
Business benefits of labor market analytics
There are many use cases for the knowledge that is generated through labor market analytics. Below are some of the most important ways in which this kind of research is known to benefit businesses and financial firms.
- Competitive advantage. As mentioned, talent is an asset of probably the greatest value in business. This means that companies are naturally competing for the professionals they want to hire as much as anywhere else. Knowing the trends in the labor market and employee expectations gives a competitive edge when looking for talent and highlighting the reasons they should be joining your company instead of the competitors.
- Crucial market predictions. The labor market is part of the market in general and an important one at that. Thus, finding out the trends here will also reveal the broader market trends to come. This allows to be more prepared for the future and plan ahead in relation to hiring and other needs.
- Investment intelligence. Not only business managers benefit from labor market analytics. So do the investors and hedge fund managers, who need to determine the upcoming stock market trends. Industry hiring rates, a company's growth or decline in employee size, as well as workplace satisfaction at a particular firm, are all important metrics when considering making an investment. All this knowledge adds to the broader investment intelligence that enhances decision-making.
- Brand building. Every company needs to think about its public image and how well its brand is known and received. Being labeled a bad employer can really hurt this image. While building a reputation of a caring, socially responsible, and professional employer boosts the brand and does wonders for marketing. All this is achieved easier when the labor market is understood better, and trends are noticed early.
Naturally, there is no way of listing all the business benefits of labor market analytics. In fact, it is not even possible to know them all, because deeper insights that come from data analysis sometimes benefit the firm in more ways than they could have expected. This all goes to show the importance of the role that data analytics play in modern business.