May 30, 2018
Brad Williams explains, for the first time ever, there’s a job
opening for every unemployed worker
The big pickup in job openings has done what’s not ever been
accomplished in the nearly two-decade history of this economic
series — there’s now a job opening for every unemployed worker.
According to the latest data from the Job Openings and Labor
Turnover Survey, there were 6.55 job openings in March. In March,
there were 6.59 million unemployed, meaning there are 1.01
unemployed workers for every job.
In July 2009, just as the U.S. exited the Great Recession, there
were 6.65 unemployed people for every available job.
The question now of course is how to get those unemployed workers
into those jobs. It won’t be easy.
The fact that job openings have climbed so steadily — at a time
when jobs growth is slowing — suggests that companies are now
having a hard time finding the right workers.
A separate survey from the National Federation of Independent
Business found that 88% of companies hiring or trying to hire
reported few or no qualified applicants for the positions they were
trying to fill. Other business surveys report similar
complaints.
Related: Small-business sentiment barely registers an increase in
April
The standard retort to that point, is if the job market is so
tight, why aren’t companies aggressively raising wages?
The fact is companies are increasing pay, though not at the rate
typically associated with a tight labor market. While average
hourly pay was just 2.6% in the 12 months ending April, the
three-month average of median wage growth in March was a stronger
3.3%, according to Atlanta Fed data.
With higher-paid older workers leaving the workforce, the average
rate of pay may be depressed.
Besides, the JOLTS report put the quits rate at the highest level
since the recession. Workers are choosing to ditch their jobs
presumedly because there’s incentive for them to do so.