It's better to have a job when you're looking for a job

As the 2007-2008 financial crisis and subsequent economic recession fade further and further into the distance, we don't in 2017 talk about unemployment all that much. The sustained recovery in the labor market has pushed unemployment to near "full employment" levels of about 4.5% in the US, and in many sectors and job roles most employers would report 'good help is hard to find'. Until the robots take over. But that is a different story for another time.

Back to unemployment though. In 2008 and 2009, there was plenty of discussion about the best ways to help the many, many folks who were out of work to get back into the labor force. Lots of job search gurus appeared online, plenty of networking and support groups were created, and certainly significant governmental support, (cars, banking, insurance), was marshalled to try and stop the bleeding in the labor markets and help get people back to work (or keep them in work).

Around that time, as the unemployment rate topped at about 10%, one peculiar storyline emerged, and pretty consistently as well - namely that folks who were unemployed, and 'actively' looking for work, were often characterized as less desirable candidates than say someone who was currently employed, and may not even be actively looking for something new. The dream 'passive' candidate if you prefer that term. Lots of anecdotes about hiring managers passing on any candidate who was out of work were shared, and plenty of folks, (I possibly was one of them), opined about how unfair that this kind of (for lack of a better word) discrimination against the unemployed was seemingly more and more prevalent. And anecdotal or not, it certainly seemed that looking for a job when you did not have a job was much, much tougher than looking for one when you were already employed.

But just how much tougher is it, really?

A recent study by the Federal Reserve Bank of New York looks to put at least some data around these anecdotes by looking at job search activity by unemployed workers, by employed workers, (both passive and active), and people out of the workforce. The entire report is interesting and worth a read but I thought I would tease out two of the report's most interesting findings about job search, and more importantly, job search outcomes.

1 - Lots of employed people are actively looking for work - almost one quarter of them 'actively' searched in the trailing four weeks of the survey period

Not shocking I guess, but also the 23.3% doesn't account for the probably much larger number of employed workers that would be open to at least discussing new opportunities, even if they were not in active search. Said differently, one of the reasons contributing to a bias in favor of employed workers is the fact that just about all employed workers are still in the candidate pool anyway. At least partially in.

So how does this perceived bias influence outcomes? Here's the money chart from the study, depicting how search behavior and application intensity translate into positive outcomes, i.e. job offers.

I will help you with the fine print here. Unemployed workers make up about 7 percent of the survey sample. They send out 40 percent of the total job applications, but receive only about 16 percent of the total job offers.

In contrast, folks who were employed and were actively looking for work make up about 20 percent of the sample but receive almost half of all offers. Further, the employed not looking for work (and who do not apply for any jobs), receive about one‑fourth of all the offers in our sample—more than the unemployed who are the most active searchers and applicants.

So how much better is it to be employed when looking, (or in many cases not looking) for a new role?

Well, according to this data, much, much better. Roughly it takes eight times the effort in terms of time spent and four times the application rate for unemployed folks to generate a similar rate of job offers that employed workers realize - many of whom are not looking for work at all.

Hopefully we won't have another dramatic economic or market shifting incident like the financial crisis that drives up unemployment and will make these findings and their impacts top of mind again. But it is good food for thought for any of us who may not love the job we have now, and are looking for something better.

We just might want to hold on to that crappy job as long as we can, because having it makes our odds of finding the next (hopefully less crappy) job that much better.

Don't assume everyone knows diversity is an issue at your company

Pop culture fans probably know the name Aaron Sorkin - Oscar and Emmy award winner of movies/shows like "A Few Good Men", "The Newsroom", and "The West Wing", to name just a few. Sorkin has been a successful Hollywood creative type for years, decades even.  A Few Good Men was written in 1992 for a bit of reference.

So since at least the release of the movie version of A Few Good Men, (late 1992 and  for which Sorkin wrote the screenplay, and is essential cable TV movie watching to this day), Sorkin has been an important, active, and influential Hollywood person. Around long enough to understand how the movie and TV business works, to know scores of company executives, producers, investors, as well as creatives like himself - other writers, actors, and behind the scene professionals.  

Around long enough, (and making the assumption that he is not some kind of anti-social savant who only emerges from his office once every two years with his latest script), to be aware of one of Hollywood's most pressing, current, and heavily-discussed industry issues. Namely, the past and ongoing challenges for access, opportunity, and reward that have faced people of color, women of every color, and other less-represented groups. Last year's Oscars brought many of these issues to wider exposure with the #OscarsSoWhite controversy and discussion.

So you would think, or assume, that a Hollywood veteran like Sorkin - experienced, successful, extremely well-known and with a pretty high profile, would have interesting or at least some kind of a view or opinion about Hollywood's ongoing diversity challenges.  You would think he may even have some advice, or a solution to propose. 

You'd think wrong, apparently.

According to a report in Variety, and expanded upon in Business Insider,  Sorkin expressed a lack of awareness of the issue, (not a lack of understanding, I am talking simple awareness here), of these issues that was kind of shocking.

From the Business Insider piece:

It's really hard to hide from the diversity issue that's plaguing Hollywood, unless apparently you're Aaron Sorkin. 

The Oscar-winning screenwriter and creator of TV shows like "The West Wing" and "The Newsroom" sounded legitimately shocked when the topic came up while he was onstage at the Writers Guild Festival on Saturday, according to a Variety report of the event.

While Sorkin looked back on his career and talked about issues of the day with moderator Elvis Mitchell, the topic moved to the need for more diversity in writers' rooms for TV shows. It seemed like Sorkin had genuinely never realized it was an issue in the industry.

“Are you saying that women and minorities have a more difficult time getting their stuff read than white men and you’re also saying that [white men] get to make mediocre movies and can continue on?” he asked the audience, Variety reported.

While conversation shifted to other topics, Sorkin still couldn't let go of this new insight.

“You’re saying that if you are a woman or a person of color, you have to hit it out of the park in order to get another chance?” Sorkin reportedly said.

Kind of amazing, it seems to me, that an industry vet like Sorkin would have been that unaware or indifferent to an issue which as recently as last year, dominated the discussion surrounding the most important industry event and awards show, a show which Sorkin might even have attended himself.

But let's assume that was indeed the case, and Sorkin's success over the years, and his position as, well, an older white dude, has kept him pretty insulated from Hollywood's diversity discussion. It's not cool, but it is at least plausible. And if we take these quotes from Sorkin at face value, it seems at least mostly true.

What do we take away from this, i.e., why should it matter to us and our organizations?

Because the story reminds us that we can never just assume people with experience, who have been successful in their fields, who are perhaps the leaders in our organization, (and who might, possibly, have a little bit of 'Sorkin' in them), actually are cognizant to the potential diversity and inclusion issues in our companies and in industry more broadly.

There are probably at least some leaders or influential people (say a hiring manager that hires for a large volume of positions), that might be of the mindset, like Sorkin, for whom these issues are just not a part of their experience and not on their radar as they make people and talent decisions.

Sure, they may have glanced at your gender and diversity reports on hiring or promotions, but did they really interpret these the way you intended? Are you sure they understand the importance of this issue? Really sure?

From the Sorkin story we are reminded not to assume the most successful people in the organization are aware of an issue that you think is obvious, that everyone has been talking about, and that you have actually taken proactive steps to address.

It is probably worth checking on. You might end up as surprised at what you learn, just like our pal Aaron.

CHART OF THE DAY: Election edition

Wow, what a crazy few days. 

I was thinking about most of the CHART OF THE DAY posts I have run over the last couple of years and I realized that they have been, as far as I can remember, all really positive reflections of an improving US economy. 

Charts about record levels of job openings, charts about declining unemployment rates, and like today's chart that I will share in a moment, near-historic high rates of voluntary job separations, aka, 'Quits'. But no matter the chart, it has been for the most part, 'good' news.

You know what, let's just get on with the chart, courtesy of your pals at the BLS, and then some semi-related comments and observations after the data. And probably some more charts too.

1. The 'Quits' rate, i.e. the percentage of the workforce that voluntarily left their jobs sat at 2.1% in September, just a tick below the data series all time high level of 2.3% back in September 2005. Quits have been at or above 2.0%, many observers threshold for what defines a confident labor market, for a little over a year now. Said differently, the labor market seems attractive enough for more people to voluntarily quit their jobs with the expectation that a new, probably better, job can be more easily found.

2. The 'Quits' rate usually tracks pretty closely, at least directionally, with overall wage growth. And wages have been going up. Heck, here is another chart showing the year-over-year change in average hourly wages going back to 2009.

Wage increases in general help to encourage folks to move on, more confident in their ability to not only find a new job, but one with better pay and benefits as well. Like I said above, generally good economic news and data that has been trending positive for several years now.

3. Want more data to chew on while still thinking about Tuesday's results? Ok, let's toss in the standard unemployment rate chart, while not a perfect indicator of the health of the labor market, at least the one that is most well-known and followed:

Post-recession unemployment hit it's high of 10% in October 2009 and in the seven years since has meandered downward by half to its current level of 4.9%. There are some arguments over what unemployment rate constitutes so-called 'full' employment, but most economists would peg it in the range between 4% and 6%. Said differently, there is less slack in the labor market today than any time in the last 10 years.

My anecdotal evidence backing up the strength and tightness of the labor market is seen at my local dry cleaner, who has had a 'Help Wanted' sign up in the window pretty much every day in the last 2 years.

Sure, there are elements of the labor market that don't paint as encouraging a picture (labor force participation rate being one big one, increasing time-to-fill time is another, as it suggests skills mismatches in the labor force), but overall, it is hard to look at the data and not conclude that since the depths of the recession in 2008, that the labor market and the overall economy are light years better than in those bad times.

4. Want some other data that is not directly related to the labor market but still provides a window view to the strength and health of the economy? How about the S&P 500 , the broad barometer of the performance/value of large company stocks and a pretty decent overall proxy for 'the market'. Here is the last 5 years or so of the S&P 500 Index to take a look at:

That is a pretty nice 5 year run if you had some money sitting in an S&P 500 index fund for the last few years. It is even better of you push the window back to start at the bottom of the recession in 2008 or so, but the charting tool I found was not that flexible, and I think you get the point anyway. If you were fortunate enough to still have investable funds at the end of the recession, you probably feel pretty decent about how those investments performed.

So getting back to the surprising results from Tuesday, and buying in to (which I do), that political maxim of 'It's the economy, stupid', then what accounts for the startling repudiation of the status quo, and the rejection of the continuation, more or less, of the policies of the last eight years of recovery and growth?

I suppose the core can be found in another maxim, this one about progress, technology, and the future.

The science fiction author William Gibson once said "The future has already arrived. It's just not evenly distributed yet."

Let's look at one last chart that kind of channels the Gibson quote and also suggests possible reasons why in spite of all this good economic news, (as I write this the Dow Jones and the S&P 500 just closed a stone's throw from their all time record highs, reversing an anticipated market plunge in the hours just after the election results were clear):

Going back a ways, and certainly before the last decade, the 'spoils' of a growing economy have increasingly gone to a smaller percentage of folks in the US. There are probably hundreds of reasons why this has been the case, but in terms of making a decision about a candidate, a party, a platform, and an expected (or hoped for) future, none of the underlying reasons really matter. What matters is that for many, many people, the recovery of the better part of the last decade, the stock market comeback, and improving overall economic security and prosperity have passed them by.

And it is easy for the folks like me and maybe some of you, and certainly the powers that be in both major parties, and the media, and the corporate big shots, and the hedge fund guys, and the Silicon Valley tech bros, and all the people who think they run things to have forgotten about that, or just to have ignored it completely. After all, most of the people we know are doing ok. Most of our friends seem really secure.  No one we talked to said they voted for the other guy.

I think that what we did learn on Tuesday night, or at least one of the things we learned, is that for millions and millions of people most of the economic recovery has simply not happened. Their jobs, if they are employed, are worse than the ones they used to have. They have less job security than ever before. They are increasingly unprepared to do many of the 'new' kinds of jobs that might improve their situation. And every day some 23 year-old Stanford grad invents some new technology that has the potential to automate, disaggregate, and 'productize' with an app or a algorithm the kinds of work they used to rely upon to take care of themselves and their families. Self driving cars are going to be awesome, right? Unless you are a bus, taxi, or commericial truck driver. If you have one of those jobs, well, good luck.

I am stupid and I do think it's the economy. And I think until we all figure out ways to have this incredible, amazing, technologically wonderful future more evenly distribted we will remain a country very divided. 

But even as we struggle with figuring it all out if nothing else the results Tuesday should ensure that we no longer continue to ignore or wish away these problems.

Working too much is (possibly) bad for your brain

Quick question, if you had to guess, what do you think would be 'better' (for folks 40 and older), in terms of maintaining or even enhancing your overall cognitive abilities - I will give you two options, pick the one you think would be 'better'.

1. Working at a full-time job that is a real grind, and putting in 60+ hours/week

2. Doing more or less nothing in terms of paid employment, i.e., spending a lot of time playing video games, watching Netflix - that kind of thing

Well, according to a recent research study published at the University of Melbourne, the guy sitting on the sofa binge watching The Walking Dead is probably better off, at least in terms of cognitive functioning, than the 60 hours/week work hero.Three Flags (1958), Jasper Johns

So what might be the true, 'best' option to keep cognitive function from deteriorating as we get older?

Unsurprisingly, the answer lies somewhere in between the two extremes of 'doing nothing' and 'probably working too much.'

From the University of Melbourne's findings:

Our findings show that there is a non-linearity in the effect of working hours on cognitive functioning. For working hours up to around 25 hours a week, an increase in working hours has a positive impact on cognitive functioning. However, when working hours exceed 25 hours per week, an increase in working hours has a negative impact on cognition. Interestingly, there is no statistical difference in the effects of working hours on cognitive functioning between men and women.

This could be the greatest argument yet for the three day work week, at least for folks in the 40+ crowd, (is anyone actually arguing for a three day work week? Maybe I can start the groundswell here).

But what is interesting about the research and the conclusions is how it more or less aligns with what most of us would intuitively feel to be the case - that being engaged in work helps keep the brain sharp, and the mental faculties in shape. It would be hard to argue, based on a personal and informal review of the losers in our lives, (I am looking at you, Mr. no-good brother in law), that sitting on the sofa all day is good for cognitive functioning.

What might be surprising however is the pretty low weekly working hours threshold where cognitive function starts to decline. Twenty five hours per week is squarely in the 'part-time' category, and likely not the one in which most of us find ourselves in during the prime, (or what we think is the prime), of our working careers.

So in sum the two things to at least think about are both pretty clear, and kind of obvious too.

Lots of us are working too much, and all of this work might be having a negative impact on cognitive function, (not to mention family life, stress, physical health, etc.).

But as we get older, working at least some, (up to 25 hours or so), is actually positive on a number of fronts, and should be a part of our planning as we age.

Everything in moderation. Shocking, I know.

And probably a good reminder as we hit Election Day tomorrow.

Have a great week!

REMINDER: LinkedIn is still not the real world

In what has become an annual tradition on the blog, as beloved as the lighting of the Rockefeller Center Christmas tree, the running of the bulls in Pamplona, or me passing out on the sofa in a turkey/stuffing coma each Thanksgiving, I wanted to offer my quick reminder that the world of LinkedIn has only a partial, if not passing, resemblance to the real world of work, workplaces, and the kinds of jobs most people have.

What prompts this regular reflection and reminder? As in years past, (here is what I wrote about this last winter), LinkedIn has released what they call 'The Top Skills That Can Get You Hired in 2017', based on their data set of member profiles, job posting activity, and their assessment of the candidate skills that were more likely to generate recruiter interest and hiring activity. They publish this list of 'top' skills both globally, and for a selection of countries and more or less the narrative that follows is something along the lines of 'If you want to get hired next year, you should try to acquire one (or more) of these skills.'

Here is the list of these 'top' skills for the USA for 2017, per LinkedIn:

As has been the case in the last couple of years, these 'hot' skills are dominated by the latest in IT trends and innovations. Cloud computing, user interface, algorithm design, etc., are all skills (and roles), that have certainly seen an increase in employer demand, and is often reported, can be difficult to find in candidates. So simple supply (which is not enough), and demand, (which continues to increase), for these skills naturally make them 'hot' and the folks that possess them remaining in demand.

Makes sense. Good to know. Interesting to think about if you are just starting your career and want to have at least some level of comfort about your chances of employment.

But as I like to point out, and did the last time LinkedIn shared with us what was 'hot',  these skills, or said slightly differently, the kinds of jobs that require these skills, still make up a really, really small percentage of overall employment in the USA, and are not the ones that the vast majority of people are doing.

Here's the latest data that is available from our pals at the Bureau of Labor Statistics on 'Major Occupational Groups as a Percentage of Employment', (from 2015):

Did you see the grouping for 'Computer and Mathematical', where the majority of jobs that required most of the 2017 LinkedIn 'hot' skills would typically reside?

It is down towards the bottom of the graph just after 'Personal care and service' and before 'Healthcare support'. If you go to the actual BLS data, 'Computer and Mathematical' makes up 2.9% of all jobs in the USA, about the same as it has been the last couple of years.

Even allowing for the fact that some of the 'hot' skills would be in demand in other general employment categories, is still stands to reason that just about all of the jobs where these skills are being sought out for represent, still, a sliver of the US labor market, and do not reflect the jobs that the vast majority of people are actually doing, (and will be doing for some time).

Sure, it is trendy to think that the LinkedIn skills represent the future of work, and perhaps they probably do, and I would encourage anyone, especially younger folks to think about pursuing them,  but these skills don't really represent the 'present' of work, not in a substantial way anyway.

LinkedIn is a fantastic business, a staggering success, and not at all like the real world where the overwhelming majority of workers reside.

Have a fantastic weekend And don't spend so much time on LinkedIn.