Available Jobs in US Outnumber Jobless People
This spring, the U.S. had more job openings than unemployed Americans. For the first time since 2000, the number of available jobs exceeded the number of seekers, the Labor Department said. This shift is rippling across the economy and affecting the behavior of workers and employees.
At the end of April, U.S. job openings rose to 6.7 million which is a record high, and only 6.3 million Americans were unemployed during the month. Openings had exceeded the available labor pool beginning in March, according to revised figures released Tuesday.
Better Times Ahead
The figures are the latest sign the U.S. is facing a historically tight labor market. The jobless rate lowered further in May to a seasonally adjusted 3.8%, the lowest since April 2000, the Labor Department said last week.
The labor market is forcing employers to rethink their approach to hiring, said Terri Greeno, owner of an Express Employment Professionals office in Crystal Lake. She is asking clients if they are being realistic in their demands for workers with clean criminal histories and higher levels of education.
Is it a health and safety issue? If not, employers need to ask if those demands are really related to the outcome on the job. When the unemployment rate is this low, you’re competing for workers who already have jobs. Her staffing firm is taking extra steps to fill light industrial and office jobs, reaching out to 45,000 people it has placed in positions in the past 15 years and asking if friends or family would be willing to take on work.
According to Adam Kamins, a senior economist at Moody’s Analytics, this is a very tight labor market. Everyone who wants a job has one. For workers, that’s good news. On the other hand, a tighter labor market presents several challenges to businesses. If they can’t find workers to meet the demand for their products, they can’t help the economy grow. They may instead choose to close the restaurant early or not run a third shift at the factory.
That raises costs and would cut profit margins if higher prices can’t be passed on to customers. If prices are raised, that stokes stronger inflation, which already has been on the rise in recent months. Federal Reserve policy makers are observing closely.
Worker shortages and stronger inflation could signal the economy is overheating, which will have the US need to lift interest rates more aggressively than the slow, moderate path they have signaled.
Getting Back on Their Feet
For now, the market is opening up possibilities for those who have had trouble finding employment during the past few years. Geremy Mincey, 26, had bounced between temporary jobs since dropping out of college seven years ago, working at fast-food restaurants, factories, and even as a mall Easter Bunny. He would often go months between paychecks. Earlier this year, he landed a temporary job as a saw operator at Williams Metals and Welding Alloys in Birmingham, Alabama. Last month, the firm asked him to take a full-time position with health benefits and retirement savings.
There are, however, still an elevated number of Americans who are stuck in part-time jobs and want full-time work. Others are employed but not in the jobs they want. Those include John Matous, a 38-year-old who works at a McDonald’s in Mason City, Iowa. He is an Army veteran with an associate degree in medical administration from a local community college. He would like to work at a doctor’s office but so far, he has been turned down.
On the other hand, Americans who are working or seeking work have been generally declining job positions for almost twenty years. That gives employers fewer potential workers to draw from, but also suggests there remain hundreds of thousands of Americans who could be drawn back into the labor force.
And they may be waiting for higher wages. Hourly pay for non supervisors rose 2.8% in May compared to a year earlier, the best annual gain since mid-2009. But the last time unemployment was this low, wages for those workers rose 3.9% from the previous year. The largest number of April openings, 1.3 million, were in the broad business-services sector, which includes everything from accountants and software developers to temporary staffers and clerical workers.
There were also ample job openings in some of the lowest-paying fields. There were 844,000 accommodation and food-service jobs opened in April and 735,000 unfilled retail positions. To attract workers, the Saladworks restaurant chain has raised its starting wages about 5%. It also has relaxed standards on tattoos and piercings, allowed employees to wear jeans and bandanas, and became more flexible about schedules.
“If you tell someone they can’t have Friday off for prom, they’ll quit,” Chief Executive Patrick Sugrue said. “They know they can find another job on Monday.”
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