Despite growth in job openings, job seeker ratio remains high
Employers posted 3.2 million job openings in July, a slight uptick from June, as industries such as manufacturing, arts and entertainment added positions, according to new data from the Bureau of Labor Statistics. There were 1.1 million more job openings in July than there were the previous year, according to the Job Opening and Labor Turnover Summary, or JOLTS.
Good news, right? Not exactly. The labor market is still pretty grim. In July, there were 13.9 million unemployed workers, which means there's a 4.3-to-1 ratio of unemployed workers to job openings. That's two years and seven months during which the job seeker's ratio has been "substantially above" 4-to-1, according to Heidi Shierholz with the Economic Policy Institute.
By comparison, the job seeker's ratio in December 2000 was 1.1 to 1. By industry, unemployment workers vastly outnumber openings in wholesale and retail trade, construction, leisure and hospitality, professional and business services, and education and health services.
The high ratio of unemployed workers to jobs manifests itself in long lines at job fairs, where dozens of people apply for the same position, and only one receives it, and in companies being swamped with so many resumes they can't even read them all.
This economy is creating significantly fewer jobs than economy has during previous recoveries, Shierholz writes. In the first 25 months of the recovery in the early 2000s -- December 2001 through December 2003 -- there were 85.4 million job openings in the recovery. Between July 2009 and July 2011, however there were just 68.4 million.
"Our labor market has a significant shortfall of new job openings even when measured against the exceptionally weak recovery of the early 2000s," Shierholz says.
What's holding back job growth? Demand. But what can create demand, few economists agree on.
-- Alana Semuels
Graphic courtesy of the Economic Policy Institute