I noticed an interesting post on LinkedIn that generated a passionate and heated discussion. It started with a report by The Bureau of Labor Statistic indicating that the ratio of job openings per unemployed American grew in April, bringing it to 13 consecutive months in which available jobs have outstripped the number of people out of work and searching for a job.
News organizations reported this data as hugely positive. Now, I don’t want to be a downer, but there is a fatal flaw with the underlying logic. The reporting on these numbers presume that the people available to work possess the exact same skills as the jobs that are open. It’s nonsensical to believe that there is a one-to-one match of each unemployed person with an exact open job that perfectly fits them.
The reality is not as rosy and perfect as the government and media would like to make it seem. I recognize that we are in a strong economy and employment is at a high level, but it’s not that simple. A large amount of the available jobs are highly specialized that require an expertise in a certain niche. The odds are high that the individuals that companies are looking to hire are already gainfully employed.
There was a lively and passionate debate on the story’s LinkedIn feed about the report. As you can imagine, some fell into their tribal political parties and viewed the results through their own biased lenses. Others contributed thoughtful opinions and divulged personal experiences that conflicted with the report’s glowing narrative.
Here are some of the interesting issues that they raised:
It was pointed out that a large number of the people who are in between jobs lack the skills that modern-day corporations require and are having a very difficult time finding a suitable job. They claim that companies ignore their résumés and applications.
A number of respondents questioned why businesses don’t just simply lower their requirements—if it’s so hard for them to find people. By opening up their demands, it would grant access to an untapped pool of talent instead of leaving them unfilled for long periods of time.
Recent college graduates on the forum pointed out that a large percentage of the available jobs are below their education level. It’s not as if they are coming across conceited or arrogant, but rather feel that their time, effort and investment in their education should merit a job at a more advanced level than the ones advertised. Many people are afraid that they have attained college degrees in fields where there are no longer great job opportunities available. Having a large number of fast food jobs, menial labor and contract work doesn’t compensate enough to pay back student loans and living costs.
Experienced professionals find it troubling that there aren’t sufficient high-paying jobs to absorb the talent pool properly. A great deal of criticism comes from people with extensive work experience. They feel as if they are confronting age discrimination while job seeking. According to them, companies are bypassing their job applications because of their age. A participant in the discussion pointed out that the U.S. Senate Special Committee on Aging reported, “While in 2006, workers ages 55 and over represented just 16.8% of the American labor force. In 2016, they made up 22.4% and by 2026 that number will rise to 24.8%, accounting for nearly one out of four American workers.” If this is accurate, it will be very problematic for older workers unless they become more widely accepted and appreciated by corporate America.
In this public online discourse, several people expressed that the tight labor market is unequivocally imbalanced. While the national unemployment statistics look impressive, it is an average that masks the challenges a lot of people are experiencing.
The largest generation, the Baby Boomers, turned 65 years old and are starting to retire and leave the job market. In light of their 30 or more years of experience, it will be hard to replace them with Generation-X—who are much smaller in numbers—and Millennials—who don’t have the sufficient job experience.
The labor force participation rate (the labor force participation rate refers to the number of people available for work as a percentage of the total population) is at a 40-plus year low of around 63% with 102 million American out of work. The Department of Labor conveniently leaves out the millions of people who gave up looking for a job, are finished with unemployment benefits and disappear from government statistics or are forced to retire. With the overhang of 102 million people out of work, all of a sudden the 7.5 million job openings look like a drop in the bucket.
The jobs report data is like one of those viral online posts where one person sees a blue and black dress and the other sees white and gold. The stock market is at all-time record highs and so are the employment numbers. However, anecdotally, there are a lot of people who feel left out.