Are You Awesome?

“Where are all the job seekers?,” asked The Indeed Hiring Lab, in the color accompanying their latest job seeker survey.

The site’s Economic Research Director, Nick Bunker, called that “the question on the lips of employers, economists, and any casual observer of the US labor market.”

He’s right about that. The latest JOLTS data, out Wednesday, underscored the vast disparity between vacancies and hires as the US economy re-opens in earnest following what any objective observer would describe as a reasonably successful vaccination campaign. That gap reached a record 3.28 million in May, the highest in data going back 21 years (figure below).

There are, of course, competing explanations for why “the desperate hunt for US workers continues,” as ING put it, in a Wednesday note.

The debate is hopelessly politicized, but anyone who’s a semblance of honest will admit that a variety of factors are working to keep Americans… well, working to keep them from working.

The GOP obsesses over the impact of enhanced federal unemployment assistance, but the evidence is far from conclusive when it comes to whether more generous benefits are “The Decider” (as George W. Bush might call it) when it comes to keeping prospective workers sidelined.

In the Indeed survey mentioned above, 5,000 people aged 18-64 were polled. One key takeaway was that although “many” jobless Americans “don’t feel they need to find a job right away,” they generally “do want to return to work sometime in the next three months.”

That’s not surprising. After all, enhanced federal unemployment benefits will roll off in about three months. Multiple states have already ended some programs. Just 10% of job seekers described their employment search as “urgent.” By contrast, nearly 50% said they were “passively” looking for a job. The sample also included people currently working. The jobless were almost twice as likely to describe their search as “urgent” as those who were currently employed.

Tellingly, Indeed found that “even some of those urgently searching for jobs don’t want to hop into one right away.” One in five urgent job seekers said they weren’t inclined to accept a new position immediately.

Admittedly, it’s hard to know what to make of that. There’s something oxymoronic about describing a job search as “urgent” while simultaneously saying you wouldn’t accept a job immediately if it were offered to you.

I suppose you could argue that speaks to the idea that labor feels like it finally has some bargaining power. But if I’m being honest, it likely just reflects a bit of cognitive dissonance and a predisposition to using up all available financial buffers before accepting employment.

Regular readers are well apprised of my position: If enhanced unemployment benefits have, in fact, handed some bargaining power back to labor, that’s a positive development. The economy is woefully out of balance. Labor hasn’t had any real clout in decades. In fact, it’s far from clear that most job seekers even understand the concept of bargaining power. Job seekers under 40 don’t remember a time when labor was “a thing,” so to speak. All they know is unrestrained capitalism.

That (unfortunate) reality makes me skeptical of the notion that the jobless are truly waiting around for higher wages or better offers. Sure, some are, but for many young workers (or would-be workers) “bargaining” means asking if the McRib is free when it’s around. That’s a (bad) joke, but it gets the point across.

As Indeed went on to write, “a sense of financial security is allowing some unemployed workers to be patient.” While enhanced benefits are a factor, they’re at the bottom of the list. Instead, the jobless are leaning on excess savings and their significant other(s).

Ultimately, Indeed comes to the same conclusion as most economists, including many at the Fed. Job growth over the summer may underwhelm, but the factors contributing to the lack of urgency will probably fade once enhanced benefits roll off and in-person learning resumes.

Obviously, this all assumes there’s not another egregious COVID wave. “Among the unemployed, fear about in-person work is the most frequently cited reason for not searching urgently, along with sufficient financial cushions,” Goldman wrote, summarizing the same survey.

The bank reiterated that its economists “expect sharp improvements in US labor supply in coming months as unemployment benefits normalize and vaccination rates edge up further but see downside risk from lingering virus fears.”

The delay is problematic for businesses who’d rather go ahead and hire in order to pounce on the opportunities afforded by the re-opening of the world’s largest economy. That’s especially true for bars and restaurants.

Down at one of two local marinas, there’s a new “tavern” (and I despise that synonym for “bar”) opening where an Italian restaurant used to be. There’s a placard outside that reads: “Are you awesome? Apply inside.”


Leave a Reply to therealheisenbergCancel reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

6 thoughts on “Are You Awesome?

  1. The owner of my regular “upscale-ish” restaurant tells me that some meaningful number of his former staff left the restaurant industry for good in the past year. Some nights his staff is half trainees, other nights he’s waiting tables himself, and they still can’t open for lunch for lack of staff. That said, he expects more to come back to the work in the industry after summer.

    My local “pub-ish” places seem to be steadily increasing their staff and resuming normal hours, although a number of the employees appear quite new to the work.

    This “soft open” hardly seems like a problem, in the real world.

NEWSROOM crewneck & prints