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Welcome to the U.S. Chamber of Commerce’s Monthly Workforce Monitor— an analysis of the state of the U.S. labor market and worker availability.
There are now more available jobs in the United States than there are individuals looking for work, evidence of a historically tight labor market for employers and a mounting workforce challenge that threatens the U.S. economy’s continued growth.
There were 7.1 million job openings in September, for which the most recent data is available, and only 6.8 million available workers, U.S. Chamber of Commerce analysis of new government data shows. That means there were 0.95 workers per job opening, down from a revised Worker Availability Ratio of 1.04 in August.
Notably, the 6.8 million available workers in September is down approximately 1 million from August (data reported here is not seasonally adjusted). The twelve-month moving average for the Worker Availability Ratio fell to 1.03 in September, compared 1.04, which had been steady since April. The 12-month moving average smooths seasonal and sampling variations. The September 12-month moving average mark of 1.03 is the lowest in the 19-year history of the data.
Regardless of small revisions and recent monthly variations, the recent trend of the Worker Availability Ratio is continuing evidence of historically tight labor market conditions over the past year and a significant “people gap” challenge with regard to the American workforce.
Developed by the U.S. Chamber of Commerce, the Worker Availability Ratio measures the number of available workers for every job opening. For our calculations, the total 6.8 million available workers in September 2019 included 5.5 million “actively job seekers” (corresponding to the Bureau of Labor Statistics’ [BLS] definition of unemployed persons) and 1.3 million others whom the BLS classifies as not in the labor force but “marginally attached;” that is, they want jobs, they are available to begin work immediately, and they have looked for work in the past year, though they have not actively looked for work in the most recent month.
The September Worker Availability Ratio of 0.95 is the result of dividing 6.8 million total available workers by 7.1 million job openings in September. Job openings are based on the BLS Job Openings and Labor Turnover Survey report, and BLS estimates for the latest month are subject to possible revision in the next monthly report.
Regional Worker Availability
September job openings, available workers and the corresponding Worker Availability Ratio vary across the four major Census regions.
- The Worker Availability Ratio for the Northeast Region was 1.01 available workers per job opening in September, a decrease from 1.03 in August. The 1.246 million available workers in the region reflected a combination of 1.03 million active job seekers and 216,100 available workers who had not actively searched in the previous month. The total number of available workers was down 195,000 from August. Job openings in the region totaled 1.239 million in September, down 165 thousand from August. Total employment in the region was 27.720 million in September, and available workers were 4.3% the sum of employment plus available workers.
- The Worker Availability Ratio for the Midwest Region was 0.91 available workers per job opening in September, a decrease from 0.95 in August. The 1.409 million available workers in the region reflected a combination of 1.147 million active job seekers and 262,000 available workers who had not actively searched in the previous month. The total number of available workers was down 108,000 from August. Job openings in the region totaled 1.552 million in September, down 45,000 from August. Total employment in the region was 33.867 million, and available workers were 4% the sum of employment plus available workers.
- Worker Availability Ratio for the South Region was 0.92 available workers per job opening in September, a decrease from 1.02 in August. The 2.467 million available workers in the region reflected a combination of 1.951 million active job seekers and 517,000 available workers who had not actively searched in the previous month. The total number of available workers was down 339,000 from August. Job openings in the region totaled 2.676 million in September, down 38,000 from August. Total employment in the region was 58.891 million, and available workers were 4% the sum of employment plus available workers.
- Worker Availability Ratio for the West Region was 1.01 available workers per job opening in September, a decrease from 1.05 in August. The 1.636 million available workers in the region reflected a combination of 1.338 million active job seekers and 298,000 available workers who had not actively searched in the previous month. The total number of available workers was down 363,000 from August. Job openings in the region totaled 1.628 million in September, down 38,000 from August. Total employment in the region was 37.999 million, and available workers were 4.1% the sum of employment plus available workers.
The number of job openings declined slightly from August to September in each region, but the numbers of available workers declined even more, resulting in the ratio of available workers to job openings falling for each region. Detailed regional data for employment, job openings, and available workers is provided in Table 1 of the supplemental report here.
Industry Worker Availability
In September the largest number of job openings – 1.3 million – was in the professional and business services industry group. This group includes legal, accounting, tax, bookkeeping, payroll, architectural, engineering, computer systems/software design, management or scientific consulting, advertising, and marketing services. The job openings data does not provide direct detail regarding job opening training requirements but based on the educational attainment of persons employed in this sector, it is likely that many, but not all, of these job openings would require significant education and skills. Available workers can be identified by industry only for those who are actively seeking work (unemployed) based on their reported prior employment industry.
In September an estimated 585,000 active job seekers reported that their most recent job was in the professional and business services sector – 44% of the job openings number. It is not known with any certainty whether or not unemployed persons with experience in an industry are currently seeking another job in that industry.
The second largest job openings in September – 1.3 million – was the education and health services Sector. This number reflects only private sector job openings. Public schools and public health care institutions are included under the government job openings category. There were 557,000 persons actively seeking work whose most recent employment had been in the Education and Health Services Sector.
Wholesale and retail trade, with 1 million job openings, was the third largest industry group in terms of job openings. Active job seekers whose most recent employment was in this sector totaled 666,000.
The leisure and hospitality industry group, which includes restaurants, drinking establishments, and hotels, also had about 1 million job openings in September – nearly tied with third place wholesale and retail trade. The leisure and hospitality industry group accounted for 678,000 unemployed former workers in that industry who were actively seeking a job, perhaps again in leisure and hospitality or in another industry.
Table 2 in this month’s detailed supplement report here provides more information on the industry experience perspective of employment, job openings and available workers.
The Worker Availability Ration continues to reveal that the U.S. labor market today is remarkably tighter than a decade ago, when there were approximately eight workers available for each open job. Over the almost 20-year history of available data, there have been an average of 2.9 workers for each open position. Now there is fewer than one worker available per job opening. Said another way, employers looking to fill open positions are experiencing a labor market that’s nearly three times tighter than it has been on average over the last two decades and eight times tighter than it was 10 years ago.
In our dynamic labor market, workers are continually shifting between jobs or moving in and out of the market. Over on the employer side, jobs are continually being filled as new ones open up. Consequently, the individuals available for work and the jobs open are not the same from one month to the next, but the trend toward fewer available workers relative to the rising number of job openings shows, in broad terms, the increasing tightness of the labor market.
Of course, available workers vary in terms of experience, skills, and location, so they may not match the occupational, skill, location, and other needs associated with job openings. This “mismatch” problem becomes especially critical when the Worker Availability Ratio is relatively low, as it is currently.
The data draw attention to an important but overshadowed “gap” in the American workforce. While much attention has been given to the skills gap – that is, that too many people lack the skills they need to compete for jobs in today’s economy — our nation also faces a growing people gap — in other words, there simply are too few workers relative to the demand. To learn more about how the U.S. Chamber and the U.S. Chamber of Commerce Foundation are working to close the gaps in the American workforce, visit our Center for Education and Workforce.
Estimates of available workers for each month are based on the BLS Employment Situation Report monthly estimates for persons unemployed and for persons not in the labor force but “marginally attached.” These BLS estimates are derived from the monthly Current Population Survey (CPS) of households conducted jointly by Census and BLS. For our report unemployed persons are described as “active” and persons marginally attached are described as “inactive” in terms of their job seeking behavior. Besides the published estimates from the BLS Employment Situation Report, the U.S. Chamber’s Workforce Monitor Series analyzes publicly released CPS individual survey response data records to examine in more detail the characteristics of available workers, employed workers and others.
To calculate the Worker Availability Ratio, we first establish the total number of available workers by adding the total “unemployed” individuals (those who actively sought work that month) and the total “marginally attached” individuals (those who did not seek work that month but say they want and are available for work and have sought work in the past year), as reported monthly by the Bureau of Labor Statistics. We then divide the total “available workers” by the number of job openings, as reported in BLS’s monthly Job Openings and Labor Turnover Survey (JOLTS).
Our detailed tabulations provide insights regarding the distribution of available workers by geographic region, age, sex, school enrollment, educational attainment, race, and other characteristics. For active job seekers with prior work experience, the data also shows the industry in which the person last worked. For available workers who are not active job seekers in the most recent month, the CPS data provides information regarding the primary reason for job search inactivity. Inactive search reason data may be useful for shaping strategies by government or by businesses better to connect these marginally available workers to the job openings and to improve the efficiency of the labor market.
Total employment by industry is estimated by inference from the industry level unemployment rates number of unemployed persons with prior employment experience in the indicated industry as published in Table A-14 of the BLS Monthly Employment Situation Report. Persons employed in the current month who were not in the labor force or who changed jobs from a different Industry in the previous month are not reflected in these estimates. No prior employment experience by industry is available for available workers whose current job search status is inactive (i.e., marginally attached category).
The data used in these calculations are all “not seasonally adjusted” because BLS does not publish seasonally adjusted estimates for the “marginally attached” series. The Chamber’s tabulations of Current Population Survey data was based on the Integrated Public Use Microdata Series, Current Population Survey data files maintained and published online by the University of Minnesota at www.ipums.org.
The Census Region definitions used in this report are as follows:
Northeast: Maine, Vermont, New Hampshire, Massachusetts, Rhode Island, Connecticut, New York, New Jersey, Pennsylvania;
Midwest: Ohio, Indiana, Michigan, Illinois, Wisconsin, Missouri, Iowa, Minnesota, Kansas, Nebraska, South Dakota, North Dakota
South: Maryland, Delaware, West Virginia, Virginia, Kentucky, Tennessee, North Carolina, South Carolina, Georgia, Florida, Alabama, Mississippi, Arkansas, Oklahoma, Louisiana, Texas; District of Columbia
West: Montana, Wyoming, Colorado, New Mexico, Idaho, Utah, Arizona, Nevada, Alaska, Washington, Oregon, California, Hawaii