I saw Bill Clinton on Letterman explaining that for the "first time new job postings are opening up twice as fast as job hires....because of skills mismatch....[unemployment would drop] 9.6 to 6.9" last Monday, the night my Labor Market paper came out. It's 2 minutes and 40 seconds into the clip.
Yup, he said 6.9%, and he's continuing the line. Atrios raged when he heard something similar on NPR.
To clarify, here's EPI with Bill Clinton Gets it Wrong:
The fact that private employers hired 63% more people than the number of openings they had indicates that they have not had trouble finding workers with adequate skills. In fact, the ratio of hires to job openings has been higher during the current recovery than at any time during the prior recovery of the early 2000s. It is not the skills of the workforce that limit our ability to reduce unemployment, but the limited number of job openings due to a shortfall in consumer and business demand for goods and services.
How can there be more new hires than new job openings? The openings are measured at the end of each month while the number of new hires reflects hires made throughout the month. This means that many jobs open and are filled within the same month and are not included in the count of new job openings. Still, these data show that there is not a backlog of job openings that are going unfilled.
For a more detailed explanation of why the current unemployment crisis is not a structural problem, see our recent paper, Reasons for Skepticism about Structural Unemployment.
I'm all for getting better education outcomes, but the idea that unemployment would be 6.9% with better skills (or if we demolished the minimum wage) is not at all aligned with the current situation. I understand the desire to use the unemployment situation to advance projects both good and bad. But to assume it's mostly a supply-side, instead of demand-side, phenomenon is simply incorrect.
Mike Konczal is a Fellow at the Roosevelt Institute.