A series of mismatches mean would-be workers can’t find employment despite an abundance of openings.
In “ Why America has 8.4 million unemployed when there are 10 million job openings,” WaPo economic reporters Heather Long, Alyssa Fowers, and Andrew Van Dam point to several mismatches. A mystery sits at the heart of the economic recovery: There are 10 million job openings, yet more than 8.4 million unemployed are still actively looking for work. The job market looks, in some ways, like a boom-time situation. Business owners complain they can’t find enough workers, pay is rising rapidly, and customers are greeted with “please be patient, we’re short-staffed” signs at many stores and restaurants. But the nation remains in the midst of a deadly pandemic with covid-19 hospitalizations back at their highest rates since January. The surge is weighing on the labor market again, with a mere 235,000 jobs added in August. There are still 5 million fewer jobs compared to before the pandemic, reflecting ongoing problems, including child care as some schools and day cares shut down again from outbreaks. […] At heart, there is a massive reallocation underway in the economy that’s triggering a “Great Reassessment” of work in America from both the employer and employee perspectives. Workers are shifting where they want to work — and how. For some, this is a personal choice. The pandemic and all of the anxieties, lockdowns and time at home have changed people. Some want to work remotely forever. Others want to spend more time with family. And others want a more flexible or more meaningful career path. It’s the “you only live once” mentality on steroids. Meanwhile, companies are beefing up automation and redoing entire supply chains and office setups. The reassessment is playing out in all facets of the labor market this year, as people make very different decisions about work than they did pre-pandemic. Resignations are the highest on record — up 13 percent over pre-pandemic levels. There are 4.9 million more people who aren’t working or looking for work than there were before the pandemic. There’s a surge in retirements with 3.6 million people retiring during the pandemic, or more than 2 million more than expected. And there’s been a boost in entrepreneurship that has caused the biggest jump in years in new business applications. So, it makes sense that the pandemic has caused people to reassess their life. Some older folks who were working to sock away a few extra dollars for their retirement figured that it just wasn’t worth it anymore. Folks tired of working for others are starting their own businesses. But they shouldn’t be showing up in the unemployment numbers. This is more helpful: It doesn’t help that the abundance of job openings right now are not in the same occupations — or same locations — where people worked pre-pandemic. There is a fundamental mismatch between what industries have the most job openings now and how many unemployed people used to work in that industry pre-pandemic.
