The Truth Behind the Job Numbers

Nancy Anderson
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The U.S. government's monthly labor report paints a glowing picture of the job numbers in a robust economy. The unemployment rate is 3.8 percent as of June 2018, which is historically low. Jack Kelly, founder and CEO of executive recruiting company Compliance Search Group, lends his thoughts to a more realistic perspective on the labor report for June 2018.

Full employment, generally regarded as 5 percent unemployment, means everyone who wants a job has a job, so how is the unemployment rate lower than 5 percent? The job numbers leave out certain segments of the population. The 3.8 percent figure may reflect people in between jobs, basically those transitioning from one position to another, in the search for a better job due to a highly competitive market. People hop from one job to the next trying to make a better career move.

The U.S. economy is at full employment in its job numbers due to the exact same number of people who are unemployed as there are job openings to fill in mid-2018. This hasn't happened in the history of the U.S. economy since the Department of Labor tracked the number of job openings.

Three Things Should Happen

Kelly talks about three things that should happen if the job numbers indicate a rate that's better than full employment in 2018. First, because of extra competition for employees, wages should rise because companies are having a hard time hiring good help. That salary increase simply hasn't happened yet, or it's happening more slowly than it did last time unemployment was below 4 percent.

Second, companies should also be offering training courses for people who lack qualifications for certain positions so they can at least get someone on board. Instead, the average job posting has a lengthy list of qualifications a mile long.

Third, businesses should offer higher starting salaries to draw top talent. However, top employers aren't increasing their salaries to try to woo people away from their competitors due to a tight labor market. If there are so many openings, companies would do whatever it takes to get someone into a position.

What's Actually Happening

The job numbers for June 2018 don't reflect people in the gig economy, the workers who have part-time work doing contract work. Neither do the data take into account people who stopped receiving unemployment benefits because they're out of work for an extended period of time. When someone stops collecting unemployment, the government stops counting that person as unemployed.

Two generations of workers don't show up in the monthly labor report. Baby boomers are struggling to recover the nest eggs they lost during the Great Recession, and they may have more than one job to compensate. This generation may stay in the labor market beyond the retirement age of 65. Millennials, in their push to pay off student debt, get low-paying jobs right out of college because they cannot find jobs befitting their degrees just yet.

A more realistic perspective on job numbers for June 2018 gives both recruiters and job seekers a better idea as to what candidates need in terms of becoming successful. There may still be millions of people who want a great position but don't have one yet.

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  • Ali B.
    Ali B.

    This job will help me become selfrelif

  • Nancy Anderson
    Nancy Anderson

    Thanks for the great comments. @Samuel Langham - thank you for that. It would be interesting to find a survey that is done on how long employees remain at a company after the company spends the training dollars on them. If the company were smart, they would have them sign that they will remain at the company for X years unless the company lets them go. I know - sounds like becoming an indentured slave but it's pretty much the only way that the company can recoup the cost of the additional education and training. @Leo M you are probably correct in stating that companies are not very loyal to the employees. We hear it all of the time. They always figured that they could find someone else to fill the position. However, now that we are at 4% unemployment in our country, the pickings are slim for companies. So, hopefully, in time, that will turn around where there is mutual respect - on both the employer and employee sides.

  • Leo M.
    Leo M.

    I also see that companies aren't that loyal to their employees. They want to get the most from employees but not pay them what they're worth & most end up costing the company more money due to rework & customer down time due to mistakes made time & time again & other employees having to correct the mistakes that are made by the untrained. I've worked with many that have the "I don't care" attitude & those of us that have to correct their mistakes still have their own work to do but don't usually get recognized for our efforts.

  • Samuel Langham
    Samuel Langham

    I agree with Training as Root Cause; but hear me out. In the 80's companies employed someone for 20 years, today the employee doesn't stay but a few years and invested money and time is wasted. Formal Training is extremely expensive, and college, even Tech Schools, do not teach the skills. However, when the training programs were put down they assumed Automation, OJT with CBT augmented with a mix of College and informal training would fill the gaps. This gave rise to the ITIL and similar Quality / Performance type programs key word "continuous improvement". Employees must have the tools and skills to succeed and drive down rework and quality cost to the company, but that isn’t what they are seeing. From the company perspective, it isn’t about you it is about what you do for the company, something that most people seem to have forgotten.
    Every Root Cause Issue revolves around Training and Mid-Level Leadership not performing as expected. The old timers aren't passing basic skills down to the new folks such as, Basic Troubleshooting methodologies those core skill sets required to do a technical job. Training can be accomplished in a number of ways but Training requires set aside time to be accomplished with formal curriculum to demonstrate the Job Skills being addressed. I loved the formal schools, I wrote and edited/updated curriculum; but in the end if the company can't keep it's people then that money is very much walking out the door with each ex-employee. So, the training issue comes down to keeping good employees so the company gets a return on investment from investing in them.

  • Nancy Anderson
    Nancy Anderson

    @Bryce Rooney thanks for your comment. Couldn't have said it better. Companies don't want to spend the time and money to train. If you don't know how to do it, they don't want you. They will continue beating the bushes until they find what they are looking for. I have to agree that companies focus too much on their bottom line and less on what they need now and in the future. In-house training can't be beat. Hopefully companies will start realizing this and start providing new hires with the tools necessary to be successful. If the employees are successful, the company will be also.


    Back in the 80s that is the way it was done companies invested in the training of their employees. When I started as a Field Engineer at Motorola I went to the company training facility in Mansfield Mass. I spent five weeks learning the base product line and the Motorola way of customer service. The training process made the company number one in the industry for service and support. Companies focus too much on the expense line items on a spreadsheet and do not see the big picture. I believe the companies that realize this as an issue will be successful and the ones that do not the market will take care of long term.

  • Nancy Anderson
    Nancy Anderson

    @Mark Priebe thanks for your comment. I was just watching a segment on the news about this very same issue. The big concern is the heavy debt load that millennials are carrying today. College is more expensive than ever. I have to agree that companies should have training for new hires. To make the transition from college into the workplace easier, companies should consider having joint ventures with the local colleges and trade schools. They should work with the colleges to make sure that new grads do have the technology and hands-on experience that their company needs. In addition, companies should have continuous training to keep both themselves and their employees up to date on the new technology they need to be competitive. Do you think this will ever happen?

  • Mark Priebe
    Mark Priebe

    Too many openings requiring security clearances but company won't sponsor...too many openings requiring certifications but company won't help obtain & ignore your educational degree, experience and knowledge...companies that are hiring only want a perfect easy match as direct result of internet job matching and are not willing to invest to onboard and ramp up a qualified candidate because they are just 3rd party users of the expensive to use technology they've bought without willing to pay for the product training needed.



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