Bloomberg Businessweek October 18, 2021 pp34-37 |Economics|”Stuck on the Sidelines of The U.S. Job Market” “Conversations with some of the 5 million out-of-work Americans shed light on why so many jobs are going begging.” “THE BOTTOM LINE A smaller-than-expected increase in payrolls in September is evidence that the pandemic’s impact on livelihoods will take longer to overcome than economists initially hoped.”
Image from Bloomberg. Only 194,000 workers added against an expectation of 500,000. The disconnect explained below.
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Many wonder why 5 million workers are still not matched up with job openings. “To find out why so many working-age people remain on the sidelines. Bloomberg news spoke at length with 10 of them.” Key reasons why so many workers are still on the sidelines are; many positions offered are only part-time, many are caring for children or elders, some are in the process of changing careers, some are still tapping what remains of various governmental or family support while searching for a job that fits their lifestyle and economics, some construction is slowed by supply-chain issues, the connection between employee and employer is still fractured by COVID, many workers have abandon the hospitality industry, some workers live in rural areas and can’t accept jobs in urban locales and lastly many still worry about contracting COVID should they opt to return to office for jobs that match their previous compensation.
Revealing threads in the discussions make it clear that wage and hour mismatch are a significant and recurring theme. Many would be workers are struggling to find jobs that match their previous hours, work flexibility and compensation including benefits. These candidates are willing to hold out at least for a while longer for the right role. Another illuminating point is the disconnect between employer and employee. Unlike in many European countries in which companies furloughed employees only to call them back after COVID, American companies and American workers severed their relationship and there’s little if any coordination in matching back up. So five million openings and five million unemployed workers don't just match up readily. Experts echoe this assessment. According to Bruce Kasman (JP Morgan Chase) “It’s a labor market that hasn’t fully healed.” It’s believed by Kasman and other economists “that unemployment will revert to pre-pandemic level of 3.8% sometime in 2023.” Prior to the pandemic U.S. Labor force participation rate was nearly 63% but fell to about 60% and now rests at a little more than 61%.
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