There is a story developing in the labor market, which has marked a significant shift in who is participating amid the ongoing pandemic.
Among the many stories are resignations, for various reasons, and the struggle to fill more labor-intensive jobs. It has resulted in an unprecedented demand for more highly-skilled, remote jobs, and those willing to work in lower-wage jobs are being paid significantly more than those who previously held the positions.
ZipRecruiter chief economist Julia Pollak told Yahoo Finance that low wage workers are in a stronger position than ever before to demand higher wages.
At the start of the pandemic, 80{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} of the jobs that were lost were from the lowest quarter of income distribution. As a result, those who now work in those jobs are earning more.
“Wage growth is actually fastest for workers at the bottom. And some groups of workers that typically really struggle, like teenagers, especially Black male teenagers, actually have lower unemployment rates than they have historically, typically. So, very puzzling, unusual situation,” Pollak said.
But a disparity still exists. The unemployment rate now is 4.0{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} for whites and 7.9{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} for Blacks, according to Pollak.
So what does that mean for the future? Jain Family Institute Senior Fellow Claudia Sahm told Yahoo Finance said it remains to be seen, as more and more statistics and data are coming in.
“We really, really have to look under the hood, understand different peoples’ experiences,” Sahm said.
She noted that in the story of a shifting labor market, there is a clear disparity in where jobs are and where people are going — but there’s more to the story.
“I’ve been very critical of the ‘Great Resignation’ story, in the sense of the pandemic has had people step back and rethink their lives, and now they’re going to work less, or pursue some other passion. The reality is, the ‘rethinking our lives,’ is a privilege and something that professional workers, higher income workers, are able to do. And that is, frankly, not a choice that most American workers can have,” Sahm said.
For those who can seek remote work or better paying skilled jobs, the available jobs don’t match the supply, according to Pollak.
“It is a numbers game. There are certainly areas where there are huge labor shortages, and employers are struggling to find candidates. But there are many other roles … remote jobs, where there are 50, 60, 70,100 applications per posting,” she said.
In fact, 55{1b90e59fe8a6c14b55fbbae1d9373c165823754d058ebf80beecafc6dee5063a} of job seekers surveyed on ZipRecruiter in November said they would prefer to find a remote job, Pollak said. And a majority of those were women — but for jobs in male-dominated fields like tech.
Whether or not some who left the market return, especially for lower-wage jobs, remains to be seen.
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