A Bizarre Labor Market (with data)



As we start the New Year, we face what is perhaps the most unpredictable and bizarre labor market I can remember. This morning the Conference Board released the December Help-Wanted Online report, which apparently shows a sharp increase in labor demand over the past year in most occupations. However,  the BLS  employment by occupation data shows no corresponding gain, even in occupations with soaring want ads.  Nor does the unemployment by occupation data show any corresponding movements. 

I have my own thoughts about what the data means, which I’ll share below. But first let me present the full array of data, by occupation,  so you can make your own judgments.

The first column of data in the table below is the Supply/Demand Rate, as calculated by the Conference Board. That indicates the ratio of unemployed workers to ads, so a small number is better.  The second column is the change in online ads over the past year, as measured by the Conference Board, so a big number shows that demand has ramped up. The third and fourth columns are the changes in occupational employment and unemployment over the past year, respectively, as measured by the BLS.

The ordering of occupations by supply/demand rate feels more or less right. But when it comes to the link between changes in demand, employment, and unemployment, there’s little  consistency. We’ve got occupations with soaring demand and no gains in employment (management, transportation).  We’ve got occupations with good supply/demand ratios and no gains in demand (health practioners).  And so forth and so on.

*************************************************

           
A Bizarre Labor Market
           
           
    Supply/Demand yr/yr percentage change**
    Rate* Want Ads Employment Unemployment
Healthcare practitioner and technical  0.3 2% -1% 8%
Computer and mathematical  0.4 27% -3% 21%
Life, physical, and social science  0.8 40% 4% -3%
Architecture and engineering 1.0 47% 1% -18%
Management  1.4 56% -3% -5%
Legal  1.5 -6% 1% -32%
Business and financial operations  2.1 6% 2% 10%
Community and social services 2.3 19% -8% 6%
Arts, design, entertainment, sports, and media 2.6 9% -1% 12%
Healthcare support  2.6 2% 0% 7%
Sales and related  3.5 -2% 2% -1%
Office and administrative support  3.9 21% 0% 3%
Installation, maintenance, and repair  4.0 36% 3% 3%
Education, training, and library 4.3 22% -1% -7%
Personal care and service  5.5 8% 5% 14%
Transportation and material moving 7.4 61% 2% -2%
Protective service  8.0 34% 1% 36%
Food preparation and serving 9.2 26% 2% 6%
Production  10.8 59% 10% -6%
Building and grounds cleaning and maintenance  14.1 39% -2% 0%
Farming, fishing and forestry 28.4 38% 2% 52%
Construction and extraction  29.7 31% -8% -15%
           
*Supply/demand rate, calculated by the Conference Board, is the number of unemployed workers 
divided by number of want ads based on latest data.  
**December 2009-December 2010 for online wants ads, November 2009-November 2010 for other data
   
Data: The Conference Board, Bureau of Labor Statistics  
Calculations: South Mountain Economics LLC        

************************************************* 

My interpretation: The labor market is getting ready for a massive rise in employment over the next year,  as companies finally start hiring for positions they’ve been advertising for. 

We’ll find out soon.

Comments

  1. I hope you’re right.

  2. Is there enough historical data to show how these vary over the cycle? I am reminded of a company that held a large job fair attended by over 500 people. A month later the number of jobs openings they listed on their site had increased from 52 to 57.

  3. Are “multiple hat” job ads counted in each category to which they apply? For example jobs combining the skill sets/job responsibilities of IT analyst, database admin, project manager, and IT support liaison?
    Of late there seems to be an increasing number of such multiple-role ads. There *are* organizations with not enough work for a full-time position (or an integral number of such) in each of the categories. But it looks more like companies trying to hire jacks-of-all-trades to get more “value” out of fewer people, and possibly more “flexibility” in the hope of multiple-hat people being more fungible. Unfortunately the more job roles and “skills” you pile on, the more unrealistic the ad, and the more it repels qualified applicants who are not looking for failing in a high stress job or wasting their time on an engagement that will likely not work out.

    I usually assume that ads with long and implausible laundry lists were mostly to have grounds on which to reject “imperfect” candidates, or created by lazy managers/recruiters trying to cut down the candidate pool. But the example I gave above is genuine. The group that had this ad really wanted to staff such a position.
    Then you have the phenomenon of recruiting being farmed out to recruiting agencies, or enterprising recruiters scraping ads, which leads to hard to quantify ad duplication (often with typos/grammar errors or signature phrases intact – and you stand a chance of finding the original ad by googling those).

    Then there are “fishing” ads to collect or refresh resume/candidate pools, etc.

    But the multiple-hat roles phenomenon seems to have gotten broader recognition lately, not least as part of the “structural skills mismatch” chatter.

    • That’s an interesting point to consider. “We can’t find enough good people” really might mean “we can’t find enough supermen to maintain unsustainable productivity numbers”.

      • I’m not sure “supermen” even enters into the picture. For the most part it’s probably “this is a time to ask for more” (regarding worker “performance”). But on top of what I mentioned many employers who complain they cannot find people will stupidly exclude a large part of the candidates most likely willing to make concessions or take lowball offers.

      • While at the same time expecting the “prime” candidates they will consider, who often have jobs or can obtain better offers (or are (still?) confident they can), to make concessions and then wondering they don’t get takers.

    • Mike Mandel says:

      The methodology is supposed to eliminate ad duplication

      I’m not a real fan of the structural skills mismatch phenomenon, because the data for young workers shows the same pattern.

Trackbacks

  1. [...] A bizarre US labour market — in which Mike Mandel predicts a massive rise in employment this [...]

  2. [...] This post was mentioned on Twitter by Monica Roman Gagnier. Monica Roman Gagnier said: RT @MichaelMandel: Labor Market sending bizarre mixed signals–but may be stronger than expected this year http://wp.me/pIGEy-hp [...]

  3. [...] A Bizarre Labor Market (with data) « Mandel on Innovation and Growth This entry was posted in News. Bookmark the permalink. ← A Bizarre Labor Market (with data) [...]

  4. [...] This piece is cross-posted at Mandel on Innovation and Growth [...]

  5. [...] Companies finally ready to fill the open positions they have.  (Mandel on Innovation) [...]

  6. [...] The Conference Board’s latest survey of online help-wanted ads and says we’re “getting ready for a massive rise in employment over the next year.” [W]hen it comes to the link between changes in demand, employment, and [...]

  7. [...] I don’t have much time tonight but this is a fascinating collection of data that Mike Mandel put together. You need to go to his post for an explanation of the data and his conclusion about [...]

  8. [...] ************************************************* My interpretation: The labor market is getting ready for a massive rise in employment over the next year,  as companies finally start hiring for positions they’ve been advertising for. We’ll find out soon. This piece is cross-posted at Mandel on Innovation and Growth [...]

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