Here's an odd thing about today's jobs numbers. If you take a look at job openings vs. hires, you get a chart like this:
A job only counts as an official "job opening" if an employer is "actively recruiting" for the position. In normal times, and during recessions, there are plenty of workers to go around, which means there's little need for active recruiting. As a result, official job openings are low and there are fewer job openings than hires.
But if the economy is running hot, companies have lots of job openings they can't fill. This means they start actively recruiting and the job openings get counted. That's what you see in the shaded red area. Starting around 2015, the economy started hitting on all cylinders and there were more job openings than hires. In 2019 things started to slow down a bit, and then the pandemic hit and jobs disappeared.
Anyway, starting last September the difference between hires and job openings began to widen steadily until it hit nearly 2 million, which is where it was at its high point pre-pandemic. So that means the economy is doing well and employers are eager to hire more workers. Hooray?
Maybe, but now we view things differently. Back in 2017, the fact that companies wanted to hire more people than they could find was a good thing. It meant the labor market was tight and workers would get paid more. Today, it means . . . what?
- The labor market is tight because there are lots of people who are afraid to go back to work while COVID-19 is still loose.
- The labor market is tight because many women with children can't find childcare and are staying out of the labor force.
- The labor market is tight because workers are figuring they'll use up their unemployment benefits before they bother getting a job.
- The labor market is tight because employers are being stingy about pay and benefits. In April, average hourly earnings actually went down compared to a year ago.
All four of these are plausible reasons. In fact, all four of them could be true at the same time. We just don't know. But only if we get an answer will we have any idea whether the labor market is truly in good or bad shape.
Well, gosh, maybe one place to start would be ... the same place as 2017! That is, pay workers more.
As one comment in the previous thread observed, very very few people are lucky enough to work for the enjoyment of it. Rather, the vast majority work because they need the munneez. Some people even work very difficult jobs for horrendously low -- truly exploitive -- wages because they need the money so badly. And the fact that fewer people are compelled to do so now -- the restaurant industry is the current poster child -- is ... not a bad thing!
And as to COVID, hell yeah! If you have, say, an elderly parent at home, or someone with a chronic respiratory condition or a compromised immune system, you're scared to death of bringing the virus in the door. And as to child care, the problem is not just finding child care but finding affordable child care. Priced child care lately?
Econ 101. Supply low => raise prices => supply increases. Econ 102. Calculate income needs, search acceptable jobs and available unemployment => choose alternative that maximizes personal welfare. Not anything a reasonably attentive college freshman wouldn't understand.
Biden is fixing that by letting hundreds of thousands of 'asylum seekers' into the country...'wage inflation' won't happen due to the excess of labor.
Economists expect about 1 million new jobs for April. Jobs report comes in about 1/4 that number. Which should tell you: nobody knows a damned thing. Don't listen to their forecasts (data is very noisy anyway), and don't listen to their explanations of why the labor market is "tight." FWIW, calling the market "tight" with the number of people unemployed or sitting on the sidelines seems like a misnomer.
We have an improving but still shaky health crisis, supply chain disruptions, and an economy recovering from a shutdown we have never seen before. We may be in for a lot of herky-jerky econ news the next year or two.
If I were king, what I would do:
a) spend a ton on infrastructure beginning yesterday
b) mandate 60 days hard labor for anyone worried about inflation
Also don't think the bls is right. 6 million of the 10 million lost jobs are furloughed. What decision comes when they are added back in??
Well the extended UI benefits are gone in September. So we will know around then how much a part that is playing. I suspect a larger part than many want to admit. The extended benefits are really the only difference now (it's hard to seperate that from fear of covid since they are both part of the same overall issue).
Lack of childcare and stingy employers are pretty much constant.
I'd put lack of affordable child care in between. Child care is expensive, and many places are full now because they can't hire workers, and they can't hire workers because of COVID and because they don't pay enough.
I hope that one of the long-term effects of the COVID crisis will be that a large portion of the large population of poverty-level wage-workers starts insisting on adequate wages, from both their employers and the politicians. The pay for front-line service workers in this country is simply appalling, but the US hardly has a monopoly on "stingy employers."
You have a more optimistic view of long-term effects post-covid. Other than a few CommieMarxalist Democrats I have a hard time imagining who in DC would listen to the plees of non-incorporated low wage workers.
I'd say affordable health and child care are the two biggest distorters in the current USian job market. Damn FDR to Hell and gone for his role in the former.
The supply of childcare has likely declined somewhat, while demand has gone up substantially because of remote learning for elementary students.
The US doesn't have a monopoly on stingy employers, but isn't the country in general prosperous enough compared with others that, while small employers can't all be generous, the large ones surely can do much better? And some of the larger ones apparently got more than their share of pandemic relief, sometimes even from funds designated for small businesses?
All good reasons. But, if you want to understand why April was a slowdown, we need to figure out what happened *this* month that didn't happen in the prior two:
The *Fourth Wave*.
Right, but states kept on loosening restrictions. It's a BLS issue pure and simple. My guess between April recess/spring vacation, which occurs after Easter, which happened during the sampling period, they simply didn't get much data. These monthly gyrations have been a feature since 1948. In the pandemic era, they are magnified.
The labor market is tight because a lot of places haven't fully reopened due to fear that there will be a 4th, 5th, and 6th wave and there will be if people refuse to get vaccinated.
Your not going to have a 4th wave until fall at the earliest. Move on from that.
Jobless claims suggest total job losses are now at worst at 2008-9 levels. Total job losses were 8.6 million at the peak and permanent job losses were way worse than 2020. BLS has some issues with furloughed workers. If GDP grows 10-15% in the 2nd quarter, then total GDP will not only be higher than February 2020, but on a trend back to the 2.2 trend that prepandemic era had.
Furloughed workers should be counted as employed.
This suggests that the job market is hot to very hot, or soon will be. It's just that, as in so many other cases in C 21, it will be, um, 'unevenly distributed' 🙂
I'm looking at you, rural America.
I own a brewpub, 44 employees, in a somewhat rural small county (100k) in California. Our restaurant biz is thriving and April was our best April ever in our 7 years. Our dish and kitchen crew get around $19-20/hr with tips, and our FoH staff get around $25/hr with tips. That's to start. We need staffing everywhere and we cannot get anyone to apply. I just delivered some beer to a local grocery store and he passed on that they have 13 openings they cannot fill, their sister store down the highway has 18 more, and that both local hardware stores also cannot find applicants. He tried to offer an entry job to an applicant at min wage (currently $14 in CA), and that she said with unemployment, food stamps, and her stimulus check, she'd need $22 to start. Kind of odd logic, factoring the finite stimulus check into an hourly rate, but nonetheless, that is what many of us our facing.
For us, it is I think compounded by the resurgence of the pot industry in our neck of the woods. Since the pandemic started, it has rebounded 5-fold. People can make $25-$35/hr trimming. I am not some high end restaurant. I cannot compete with that. Not sure I have any answer to how this is going to end/get better. We are raising pay rates (and prices), and desperately trying to retain staff and lure more, but I think the combination of all of this is going to take a while to improve our situation. In the meantime, we close at 8pm with many still wanting to come here and sit outside in pleasant weather simply because we cannot find staff to extend our hours to the pre-pandemic 10pm. At least I can check restaurant-owner-during-a-pandemic off by bucket list.
I think the anecdotal person turning down a job either doesn't exist or is really bad at arithmetic. $14/hr for a 40 hour week is $540/week. this still qualifies one for a low food stamp benefit and the maximum benefit is only $200/month or less than $50/week. for a minimum wage worker in Ca, the unemployment benefit is $64/week. Add in the temporary UE benefit and it is a grand total of $414/week. I'm highly skeptical of "a know a person that knows a person that" stories when the numbers are off by that much. The stimulus check is irrelevant since a minimum wage worker will keep the entire amount whether they work or not.
barley-
My oldest works for a large fast food chain in middle management. She has 13 locations she over sees.
COVID has been a 2 edged sword
First and foremost whenever a worker got COVID they had strict quarantine protocols for the ill person and anyone in close contact. When one crew member got sick it usually meant the one person in Q, and the contact people getting tested and being off for 2 to 3 days. THAT is a nightmare
Second - her stores went drive through only, and limited hours. This was a Godsend. No employees to clean the dining area and rest rooms. All food prep was geared towards the take out orders at the window. This has lead to LOWERED drive through times for all locations. The result? Higher profit margins when locations were opened. Her bonuses, which are based on profits are astonishingly high. They are opening up dining areas and extending hours and yes they are having a hard time finding help. Who in their right mind wants to:
A - work in fast food
B - work until 2am
C - wants to have to clean toilets as part of their job
A is a constant and has always been a reason for labor shortages.
But what is interesting is that many businesses are trying to find workers who have worked "normal" hours of say 7am to 8 pm putting them home at night who are now refusing to work until 2 am.
Now take your local mall. Where I live the hours are still 11am to 7pm. That is ONE 8 hour shift for each store. They need ONE full time manager and one
part time assistant manger to cover the store 7 days per week. If they go 9am to 9pn the need for additional managers increases.
For MANY businesses COVID was an eye opener. In their continued hunt for increased sales through extended hours and days worked they actually began to reduce their own profits. With COVID they now work closer to normal hours but their profits increased.
This is anecdotal to a certain extent but has been known for quite some time in the fast food industry. Retailers are seeing this phenomena up close and personal now.
The dude that runs 'slapfish' and other pretentious eateries was on twitter claiming he was giving $17/hr for dishwashers (this in OC where $17 hr has you living in your car). Too bad folks were able to look up his actual listings in job sites, and he was giving $17 for assistant managers, didn't even list his dishwasher starting pay.
Lets note hourly earnings were distorted higher by the April 2020 lockdown issues. So they went down yry, big deal. It is still higher than you would think after a mild recession.
I believe if an employer calls you back to a job and you don't come in, you can't continue to collect enhanced or even regular unemployment.
So that's probably a relatively small factor in case, and definitely only for new hires. My nephew just took a job despite being on enhanced benefits because they don't allow you to live WELL, just to get by.
ddoubleday
Here's another interesting take to all this
The employer can force you to take the vaccine. Any place that has employees elbow to elbow or sitting adjacent to one another CAN require the vaccine before you come back to work
Saying NO to the vaccine is grounds for termination - which in itself excludes the worker from UI benefits. Think about call centers, meat packers and all food processors, assembly lines etc........... Employees would have limited options - but these are corporations
OTOH - we have Ron DeSantis saying absolutely nobody in his state can mandate masks, COVID passports or vaccines. What happens? Norwegian Cruise Lines operates 3 companies out of Miami Beach. After being caught up in the "Legionairres sicknesses" in the past while onboard they also had to cut cruises short when COVID ravaged the passenger list at the beginning of the pandemic. They shut down and are requiring vaccines now that they are looking forward to cruising again. They are threatening to pull out of Miami if they cannot require vaccine Passports. COVID is a direct threat to their passengers and their bottom line. This is also a corporation and it will be interesting to see how DeSantis responds because these cruise lines operate in international waters where DeSantis" fascism has no jurisdiction. The mayor of Miami Beach just put the finishing touches on pier renovations just before COVID and the city will be out all that money of Norwegian pulls out
As the old song goes "Sometimes you hurt the one you love............"
In the local seasonal economy, employers are complaining that they can't find help because 1)workers are loafing and living off of generous UI checks 2)the bottleneck preventing J1 and HB1 visas from being issued, choking off the usual supply of cheap labor, mainly from the Caribbean and Eastern Europe.
In other words, it's the government's fault AGAIN, as always.
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The vast majority of working women discovered their true nature, i.e. paths leading to true happiness means staying home with the kids.