More than nine million Americans said in May that they wanted jobs and couldn’t find them. Companies said that they had more than nine million jobs open that weren’t filled, a record high, the Wall Street Journal reported. As the economy reopens, the process of matching laid-off workers to jobs is proving to be slow and complicated, a contrast to the swift and decisive layoffs that followed the initial stage of the pandemic in early 2020. The disconnect helps to explain why so many companies are complaining about having trouble filling open positions so early in a recovery. It also helps to explain why wages are rising briskly even when the unemployment rate, at 5.9% in June, is well above the pre-pandemic rate of 3.5%. The relatively high jobless rate suggests an excess of labor supply that in theory should hold wages down. This has implications for policymakers: Sand in the wheels of the labor market could cause inflation pressures that spur Federal Reserve policymakers to pull back on low-interest-rate policies meant to support growth. In the longer run, on the other hand, the slow matching process could have benefits, leaving workers in jobs they prefer and the economy more efficient. Several factors are behind the development: Many workers moved during the pandemic and aren’t where jobs are available; many have changed their preferences, for instance pursuing remote work, having discovered the benefits of life with no commute; the economy itself has shifted, leading to jobs in industries such as warehousing that aren’t in places where workers live or suit the skills they have; and extended unemployment benefits and relief checks, in the meantime, are giving workers time to be choosy in their search for the next job. A recent ZipRecruiter survey found that 70% of job-seekers who last worked in the leisure and hospitality industry say they are now looking for work in a different industry. In addition, 55% of job applicants want remote jobs. An April survey of U.S. workers who lost jobs in the pandemic, conducted by the Federal Reserve Bank of Dallas, found that 30.9% didn’t want to return to their old jobs, up from 19.8% last July. (Subscription required.)
