We have a genuine puzzle in today's labor market: large numbers of unemployed workers and even larger numbers of vacant positions. As MIT labor economist David Autor noted in NYT:
Let’s start with the causes of the current labor shortage. Research on this question is unambiguous: We don’t know what’s going on.
Saturday's WSJ offered one possible culprit, based on a recent Harvard Business School survey: the software designed to match resumes with vacant positions.
Large companies cannot spend all of their time reviewing each and every job applicant, so they buy software systems and set up parameters to decide who are the lucky few who get interviewed. Many companies are screening out applicants based on skills that are not needed for the job. For instance one hospital insisted on computer programming skills for nurses who simply had to perform data entry. Similar issues arise in setting minimum education and experience requirements. For instance, how many open jobs really require a college degree?
If a critical mass of companies have not adjusted their job specs in light of today's labor shortage, then they are guaranteeing themselves problems in filling open positions. Many companies refuse to look at applicants with gap years in their employment history or who have been incarcerated. WSJ reports that some companies, including IBM, are starting to re-evaluate their hiring process.
Posts
