Although the number of job postings and open positions is going up exponentially around the country, hiring is not. So what gives? Several experts are saying it appears as if a battle is brewing between businesses that want high-skilled workers for low pay and a growing pool of workers who want to see raises.
"Back in my staffing days, we used to joke around and say, 'Got any bilingual brain surgeons for $10/hour?' It was code for a client that just wasn't ready to accept it was time to raise their rates," says career strategist and workplace consultant Jeanine Tanner “J.T.” O’Donnell in this LinkedIn post. "Employers believe they deserve a perfect match for their jobs... and at a nice low rate too."
In this New York Times article this week, Neil Irwin said employers will have to raise wages, they just don't know it yet.
"American employers are the equivalent of a shopkeeper who has a 'Help Wanted' sign permanently on display in his window, but never actually hires anybody. None of the applicants who come in offer the perfect mix of skills, experience and willingness to accept low pay that the shopkeeper is looking for."
According to the latest Labor Department data, employers had 4.8 million positions they were looking to fill in October. Irwin says that’s up 25% in the last year and 125% since the start of the "economic expansion" in 2009.
However, actual hiring is not even coming close to keeping pace. The number of people hired is up only 12% in the last year and 33% over the five-year expansion.
That means, according to the Times, the ratio of job openings to actual hiring is higher than at any other time since the feds began compiling this data in 2001.
O'Donnell, who is also CEO and founder of CAREEREALISM, says for the past several years workers dreamed of the day when the tables turned and it was "their chance" to make employers jump through hoops, and that day is here.
"Companies will not only need to make wages more attractive, they'll also need to prove to talent they are a great place to work," she added. "What a company does, how it does it, and what kind of reputation they have will matter."
Irwin writes in the Times that as the economy has improved, employers have had more job openings but have been "sorely reluctant to accept" that it’s not 2009 anymore in terms of what workers they can hire and at what wage.
"Workers aren’t in nearly as desperate a position as they were then. So to get the kind of talented people they want, employers are going to have to pay more (or offer better benefits or working conditions) than they would have not that long ago."
The Business Owner
However, a business owner from California who commented on Irwin's article this week had a slightly different viewpoint on why they are slow to hire. And it doesn't have anything to do with trying to find purple squirrels and bilingual brain surgeons for $10/hour.
"We own a business and I can tell you exactly why people aren't hiring. The cost of running a business has gone up astronomically. Workers Compensation insurance, up 50% since last year. Our business insurer came in this year and told us that they were 'taking a 30% increase.' Our health insurance went up 38%. I can't raise our prices just to cover these few examples because no one would do business with us. The money isn't growing on trees in our parking lot. Our employees go home at 3:30, we work until 7 pm. Our employees enjoy their weekends, we go in and work for 6 or 8 hours on Saturday. If it's not too much trouble, we'd like to make a living wage too..and be able to sleep at night without worrying."