The Department of Labor issued its May “Job Openings and Labor Turnover” report Tuesday, revealing a slight dip in the jobs available category. According to the report, there were nearly 100,000 less job openings in May as there were in April. The total number of job openings in May barely exceeded 3.2 million. For the unemployed, those that are receiving unemployment benefits, those that were receiving unemployment benefits extensions until June (and will presumably begin again as soon as legislation is passed), and those that are not being tracked and are looking for a job, what does it mean that there are less jobs available?
Ultimately, the publication of a report that says that there were a hundred thousand less job openings in the United States as opposed to the previous month means absolutely nothing, especially to the unemployed individual simply trying to fill an individual job opening. The Bureau of Labor Statistics produces their survey reports to give the government something upon which to estimate employment/unemployment and general trends concerning job availability, unemployment benefits, the total number of unemployed, etc., ad infinitum. Give the report to one Congressman or policymaker and it can be seen as a positive thing. Give it to someone of an opposing ideology and it can be turned into a negative.
But this report must be looked at by the public as something that does not truly reflect reality, no more than does Sarah Palin’s warnings of being mistrustful of foreign oil companies when her husband voluntarily retired from working for British Petroleum after nearly two decades. One must look at the job openings reports as general information that, taken in conjunction with other reports, might show a general trend but could just as well be an inaccurate reflection of what truly exists.
For example, the job openings portion of the survey allows for each job opening to be counted within a given month’s timeframe. Although it would be true on the surface, it would not be true in that a single job opening could become open several times in a given month. For example, it is general knowledge that the labor turnover rates in fast food restaurants is relatively high. If those job openings qualify (some will and some will not), then they could potentially account for a large number of job openings, because who doesn’t know that one person who has worked ten jobs in the past six months, working just long enough to get a paycheck before quitting?
The same can be said of the survey’s separations segment. The report for May notes that there were almost 4.1 million people separated from their jobs in May. If that is so, how could there be only 3.2 million job openings? At the same time, there were 4.5 million hires in May. How could that be? And if you do simple math, wouldn’t that, given April’s 3.3 million job openings, have left more like a 400,000 individual difference, instead of 100,000?
Actually, the answer would be “no.” Job openings that were available in the previous month and went unfilled could have been filled in May. Some job openings remain unfilled for months.
And then there is the overlap. One person could have been hired for multiple jobs (because of quitting, getting fired, laid off, etc., and hired somewhere else), being counted for both hires and separations, the job openings being filled, then not, becoming another opening. So, instead of there being a one-to-one correlation, there could potentially be a 1-2, a 2-1, a 2-2, and so on (including individuals who could possibly have multiple full- and part-time jobs). In fact, seasonal employees are counted in the hires portion of the survey as well.
Put simply these surveys put out by the government simply aren’t accurate. Sure, they’re good enough for politicians and policy makers, those guys who make up numbers off the tops of their heads instead of reading a supporting report, but for the individual that is looking for work or wondering whether or not the next installment of his unemployment benefits extension will be suspended, it means, generally, nothing.
But to those who are looking for something in the “Job Openings and Labor Turnover” surveys that might make one a little more optimistic, look elsewhere. The survey is a general trend of national numbers, meant for macroscopic perusal and analysis and not microscopic, and may not reflect your locale or region at all. Job openings and potential hirings are part of a process that requires circumstantial timing, opportunity, and skills. It is extremely individualistic.
As for those that are on long-term unemployment benefits, the report looks dire. So does the Department of Labor’s statistics that reflect a national figure of 15 million unemployed. But worse is knowing that they are not true numbers, that the total number of job openings are far fewer and that the number of unemployed are far higher. Worse is knowing that one may not have the skill sets for most of the jobs that are available or one has entered that no man’s land of unemployment, the too young to retire but too young to hire group. Worse is knowing that there is a competition going on for jobs like none seen since the Great Depression.
The Department of Labor estimates that there are five individuals (on average) applying for every job opening, which makes sense, given that there are 3.2 million job openings and an estimated 15 million unemployed. But how accurate are these numbers? Working on the idea that the unemployment estimates are far lower than the actual numbers and that job openings are probably far less, the ratio of applicants per job at best is more like 6-1. However, it is probably much worse.
Like politics, jobs are local. Numbers that appear on a national survey might be indicative of your area, they may not. They may mean nothing on a micro-economic scale. But if you’re unemployed and part of that micro-economic scale and you discover that there were 100,000 fewer job openings in May, that over 2 million individuals have lost their unemployment benefits extensions since June, that only 83,000 jobs were generated in the month of June, and that the overall economic outlook for the coming six months and more is more of the same (or marginally better), if not worse, the future might not look all that bright. The weight of those large numbers tend to weigh on an individual’s optimism.
Unfortunately, those reported numbers, instead of being seen as generalized and not directly affecting the individual, become perceived by all too many individuals as weighing upon them personally and come to mean a lot more than nothing.
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Source:
BLS.gov
