Why Is There Low Unemployment, Yet More Job Vacancies?

As reported in a recent issue of the New York Times, the picture for the job economy could not be any brighter. Looking at the facts may help form a more comprehensive perspective:

The facts say that unemployment is at its lowest since 1969. There has been consistent growth for eight years with many more job opportunities. Demographic groups that have historically found it hard to find jobs are landing them. What is not to like about this picture?

The answer is, this picture is only a partial one; it is similar to viewing a painting through narrow lenses; you need to move further back to get a more objective perspective. Looking at it more carefully there are certain issues such as a shrinking talent pool and a more competitive candidate-driven market, plus the difficulty for employers replacing seasoned workers. Research from the New York Times shows baby boomers that were in their peak working years in the 1990s are now retiring. This rate keeps on growing with 10,000 a day leaving their jobs.

The bright picture of a buoyant job market already looks a little bleaker, so what are the issues that stand in its way?

A Lack of Qualified Candidates

Let us start with the graduates leaving school:

The common misconception held by students is that a degree means more opportunities. However, this is not always the case. Mark Huffman, writing for Consumer Affairs, says there is a scarcity of college graduates that are actually job ready. Mark Beal, Public Relations Professional and Adjunct Professor at Rutgers University says today’s graduates lack the knowledge, skills, and career transition insights to progress up the career ladder. Research from an employers’ perspective agrees that graduates lack the requisite skills.

The flipside is that many candidates have the experience, but not the college degree.

Before the recession in the years 2008-2013, candidates without college degrees filled middle class jobs. A bachelor’s degree is now a widespread requirement for these ‘middle class’ jobs (nurses, network specialists, technicians); a qualification that not everybody has.

Robert Kaplan, President of the Federal Reserve Bank of Dallas says the current trend of high job vacancies could bring economic growth to a halt. Kaplan cites a report from the National Federation of Independent Business (NFIB) that shows forty five percent of small businesses were unable to fill positions due to a lack of qualified candidates in the first quarter of 2017.

We are starting to see other phenomena that are particular to the now candidate-driven market – qualified and experienced candidates are now cutting all lines of communication with the hiring authority at different stages of the interview process.

With a Great Job Economy, More Candidates are Ghosting Interviews

Ghosting is now making its way to the job market (ghosting is a common term used in modern society referring to a person that cuts all communication off with others). It is not just mom and pop stores that face candidate no shows, global firms share similar experiences– but why?

Recruiters and employers believe a narrowing job market, and ongoing labor shortage, contribute to more candidates opting out of the application process. Dan Schawel, author of Back to Human: How Great Leaders Create Connection in the Age of Isolation (Da Capo Press), argues that in this candidate driven market, job searchers are always on the lookout for the next best opportunity.

There are also less obvious reasons why candidates pull out. Career coach, Roy Cohen told Huffington Post that there are often complex psychological reasons why job searchers choose to ghost. Cohen says feelings of failure and embarrassment are often reasons why people choose to exit from the employment process.

How Do Employers Attract Candidates in an Increasingly Tight Job Market?

Forbes’ latest research found that the biggest attractors for candidates is company culture, career growth opportunities and company benefits…and not a high salary. The results of Forbes’ research are consistent with Glassdoor’s survey that found that potential employees pay closer attention to company culture, leadership, and available growth opportunities than they do salary.

Attracting Graduate Talent Through Implementing an Internship Program

Introducing an internship for new graduates is a great way of attracting younger graduate talent. It also gives students valuable experience in the working world and is an effective way of improving their job readiness. The College of St. Scholastica in Minnesota outlines benefits for both graduates and employers:

Benefits for employers:

• Enable employers to access potential talent that will benefit their firm
• Provide employers the opportunity to learn from interns’ fresh perspectives from outside the firm
• Allow interns to contribute to business without having to make a hiring commitment

Benefits for students:

• Help interns form important networking connections in their field
• Enable students to gain experience in the field of their choice- helping their career development and improving the chances of future employment
• Allows students to use their classroom knowledge in professional environments

The Take Away

With unemployment at its lowest since 1969 and more job opportunities across most industries nationwide, the future looks promising. However, looking at the picture from a more objective angle, the future for the job market is not so certain. To ensure a job market’s steady and ongoing growth, employers need to create the culture, benefits, and exciting career development opportunities that will appeal to candidates.

Employers and others argue that graduates’ lack of job readiness prevents them finding employment in the area of their choice. The proven way that both benefits students and employers is internship programs. This presents less risk for businesses and benefits students by enriching their knowledge and experience.

Shepherd Search Group and its affiliates help to identify the most sought after expertise and industry experience in this tightening job market. For candidates, we strive to find the best possible opportunities that fit both their background and qualifications. For more information go to www.ShepherdSearchGroup.com.

By: Jonathan Gordon