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.