Sunday, October 24, 2010

Jobless Need Not Apply

There is another side to the story of employers who say they can’t find qualified workers. As Laura Bassett at Huffington Post pointed out, many employers apply completely arbitrary rules to eliminate candidates, including the highly illogical but nevertheless rather common requirement that job applicants must be currently employed. Relatively few employers advertise the fact that they automatically reject unemployed applicants, but on any given day, there are at least a million job openings where unemployed workers will be eliminated on the initial screening of applicants. There are always employers who refuse to consider candidates who aren’t currently working in the field, but this has especially high impact on the job market now, which has:

  • Unnaturally low turnover, as workers who have jobs stay in them longer than usual, and those who do not may be unemployed for a very long time.
  • More unemployed workers than ever.
  • Economic uncertainty that may make workers reluctant leave a job to take a job at a company that has any questions at all about its future — which, these days, is more companies than not.
  • A large number of employed workers who cannot easily move to take a new job for reasons related to the real estate market: an underwater home mortgage, uncertainty about qualifying for a new mortgage, or difficulty in selling their current house.

In this context, any arbitrary rules or barriers that employers put in place add friction to an already choppy job market. Most of these employers will eventually hire the people they are imagining, but this could take a year or two longer than necessary, resulting in lost production and income — a loss to the economy at large.