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Ashley Webster and Susan Li of FOX Business at the Friday market opening.
Telling a story about why employers struggle to hire workers is not the same as explaining what is happening in the job market.
Economists expect Friday’s jobs report to show the economy created 706,000 jobs in June, an increase from 559,000 in May and what would normally be a large number. These are not normal times, however. The United States is still 7.6 million jobs short of what it had before the Covid-19 pandemic, and earlier this year it was hoped that as more Americans got vaccinated, the market of work would close that gap much faster than it did.
The problem is not the shortage of jobs. At the end of April, there were 9.3 million job openings according to the Labor Ministry’s tally, and companies around the world are complaining about the difficulty in finding workers. Some of the more popular explanations are that improved and extended unemployment benefits have reduced recipients’ incentives to look for work and that persistent difficulties in obtaining childcare services have deterred many women in particular from returning to work. .
FORGET TO RETURN TO THE OFFICE, PEOPLE JUST LEAVE IN PLACE
Arguments accusing one or the other fall along predictable ideological lines, but there is evidence that both weigh on the job market. More than one thing may be true in the job market at the same time, and given the unusual circumstances brought on by the pandemic, other factors could be contributing to hiring difficulties as well.
A recent survey by job search site Indeed found that among unemployed job seekers who said they were not looking for emergency work, the biggest hurdle was lingering concerns about Covid. -19. In addition to caregiving responsibilities and unemployment benefits, they cited spousal employment and having financial cushions as reasons for their lack of urgency.
Other factors could be at play, said Harvard University economist Lawrence Katz. The first is that many employers might wish things were back to their pre-pandemic status, while many workers might have something else on their minds.
“It’s a mismatch between expectations and aspirations,” he said.
KPMG Chief Economist Constance Hunter, Veritas Financial Managing Partner Greg Branch and Kingsview Wealth Management CIO Scott Martin add their views on the latest jobs and markets report ‘today.
The pandemic has been traumatic for some people, and they might need some time to process things before they go looking for a job, while for others it was just exhausting and if they can. , they may want to take advantage of the summer before looking for work. Plus, just knowing that there are plenty of job openings might deter some people from looking too hard – the easy selections seem likely to continue.
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There could also be geographic lags between where companies hire and where the unemployed previously worked. Some of them might even occur not only across state borders, but in a metropolitan area. With many offices still closed, restaurants in business districts are suffering, for example, while those near more residential areas are booming as people catch up on lost meals. Reallocating downtown restaurant workers to these new jobs could take time.
There may be limits to how quickly employers can hire, and these could be compounded by the high number of people leaving their jobs for other opportunities lately. It’s one thing to fill three open positions in a month and another to fill those positions plus the positions of three other employees who have just given notice. There could also be measurement issues since the pandemic has upended typical hiring patterns. Some economists believe Friday’s report could be strong, for example, since declines in education employment at the end of the school year could be smaller than usual.
The good news is that a lot of things that could be causing hiring tensions are expected to ease in the coming months. Most schools will return to in-person learning this fall, which could alleviate childcare issues, while the expiration of enhanced unemployment benefits arrives in September and the summer vacation season. will be completed. When it comes to things that would inspire them to step up their job search efforts, those interviewed for the Indeed survey ranked the increase in vaccinations high.
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But that might not solve everyone’s hiring problems. The pandemic has changed a lot of things in the job market. While it’s good to expect things to get back to normal, we still don’t know what normal is.
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