Capital
The Standoff -- Job Openings Vs. Job Seekers -- And Its Impacts
Nine million job openings, nine million active job seekers, and seven million fewer people employed than in April 2020. What gives?
The low-hanging fruit of the great rematch – of millions of people displaced from jobs as the pandemic paved its way through the economy through 2020 and the fits-and-starts economic reboot – is done.
The higher-hanging bounty, the promise of an ultimate re-engagement of equal measures of currently active job seekers – 9 million – with job openings, remains elusive.
Here, Wall Street Journal staffers Jon Hilsenrath and Sarah Chaney Cambon explore explanations for why unemployed Americans aren't "swiping right" to get on a payroll, any payroll at a moment many firms across many industry sectors so desperately need new headcount to keep pace with surging consumer demand.
The "why" bullet point factors for mismatches between job openings and job seekers in Hilsenrath and Chaney Combon's analysis include:
- Workers moved from job centers; jobs moved from workers
- Regional unevenness, where high-unemployment concentrates in higher-density urban areas
- Reluctance to go back to status quo workplaces after a taste of "work from home/anywhere"
- Skills mismatches, where job qualifications and career experience don't mesh
- Federal jobless benefits/Covid-19 relief policy as a demotivator
Not much considered in the WSJ analysis are factors that pre-dated the pandemic, such as the multi-decade stagnation of household incomes as costs for health care, housing, and education soared. Missing altogether here is where "opportunity" – to earn, to merit economic mobility, to work one's way up the ladder – fits in as a value proposition for household wage earners.
The collective leverage of workers – a notion that has at least surfaced as a socio-economic scenario that preceded but was accelerated by the pandemic – doesn't much figure into Hilsenrath and Chaney Combon's Beveridge Curve.-lens view of the drivers here.
If the jobless rate doesn’t fall more, the Fed will have a riddle to solve: Should it keep its low-interest rate policies in place longer to spur economic growth and more aggressive hiring by firms, or should it raise rates to forestall inflation pressures in an economy beset by nagging bottlenecks, including those in labor markets.
Prospective workers could be forced to move more aggressively in the months ahead as jobless benefits expire. Because all states are slated to end supplemental benefits by early September, the next few months will be critical in shaping how aggressively people look for jobs.
Headcount vacancies vs. job seekers gaps are particularly noteworthy in wholesaling, food services, the entertainment sector, finance and healthcare, the WSJ staffers write.
But, perhaps, "force" – presumed always to tilt the playing field of earning a living in favor of employers – may be shifting as capitalism experiments with its embrace of broader stakeholder value creation.
The New York Times' Neil Irwin writes:
The relationship between American businesses and their employees is undergoing a profound shift: For the first time in a generation, workers are gaining the upper hand.
The change is broader than the pandemic-related signing bonuses at fast-food places. Up and down the wage scale, companies are becoming more willing to pay a little more, to train workers, to take chances on people without traditional qualifications, and to show greater flexibility in where and how people work.
The erosion of employer power began during the low-unemployment years leading up to the pandemic and, given demographic trends, could persist for years.
Whether Irwin's theory here plays out across time, or whether the WSJ take that the switches and levers of policy should give workers no choice other than to go back to jobs that they already knew did not match to their career interests prior to the pandemic remain in the throes of uncertainty.
Clearly, though, how this "future of work" phenomenon plays out, and whether more people choose to "swipe right" to match with jobs employers are trying to fill right now can play a big role in one of housing's structural demand drivers – new job formations.
