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Home Publications Blogs Beat the Press Rise in Vacancy Rates Due to Employers Being Choosy

Rise in Vacancy Rates Due to Employers Being Choosy

Wednesday, 06 March 2013 21:11

The NYT has a good piece on new research that finds employers are being far more selective in their hiring. The research finds that employers are willing to interview more people and take longer in the process now than in the past.

This research is very useful because it helps to explain a seeming anomaly in the data. There had been a clear rightward shift in the Beveridge Curve in recent years, showing that there were more job vacancies at the same level of unemployment. This would often be taken as a problem of structural unemployment. However, we don't see any of the other signs of structural unemployment, most importantly, major sectors of the economy with rapidly rising wages.

This research provides an alternative explanation. Because they are many qualified job applicants, firms can have the luxury of being selective. It is also likely that waiting will pay off, which is not likely the case in a period with low unemployment, where qualified applicants are few and far between.

This one also gives me some satisfaction since I had previously speculated that this could be the case.

Comments (6)Add Comment
Dean, you should read the actual academic paper cited for this article...
written by Nhan Le, March 06, 2013 10:44
... because it does NOT say what the Times says it does.

recommend Peter Cappelli's book
written by watermelonpunch, March 07, 2013 2:34
When I stop seeing secretary receptionist job ads requiring a bachelor's degree in the field of the company's products/services... Or sales or customer service job ads that require specific, lengthy, & recent experience in the same exact industry...

Well until that nonsense stops, I'm not buying the structural B.S.

I stand firm that a company requiring a degree in electronics related field for a part-time position at the wireless kiosk at the mall does NOT constitute a jobs-skills mismatch.

And as far as I'm concerned Peter Cappelli's book is the final word on the subject in this era.
Enough said.
Another more informative version, on Bloomberg
written by David, March 07, 2013 8:53
On Bloomberg, a co-author of the 2010 paper introducing the index interprets the index of late. Of course, confidence fairies are brought in, the Booth school loves that stuff ...


The original article on the index used can be found here, but free downloads are only available to academics I think. http://ideas.repec.org/p/nbr/nberwo/17782.html
written by tom m, March 07, 2013 10:07
Dean, I was at a symposium for college teachers at the NYFed and heard this talk making a similar point:


The paper estimates that the NAIRU has increased from 5.2 to 6.0 I think, due to the shift in the Beveridge Curve (so most unemployment is cyclical). This is less than the shift in the Bev Curve b/c higher unemployment makes it easier to fill vacancies and thus creates more jobs. I don't know what to make of this...
written by why, March 07, 2013 12:22
Why would anyone give their valuable resources to the NYFed? Is one of their distinguished leader on the wall?
Long Term Unemployed
written by Robbie Bruens, March 07, 2013 6:55
Wondering what Beat the Press thinks of this Matt Yglesias piece: http://www.slate.com/blogs/moneybox/2013/03/07/ long_term_unemployment_crisis_beveridge_curve_looks_dif

He seems to argue that the growth in the number of long term unemployed is part of the story as well.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.