A recent federal bank research paper may have unveiled a strategy for the newly and long-term unemployed: Quit looking in your field of expertise.
The research, from the Federal Reserve Bank of San Francisco, showed that more than 55% of jobs filled in the US from 2005 to 2011 were with people who come from an entirely different line of work.
According to the Wall Street Journal, this new insight supports the notion that the current high level of unemployment of 8.2% is merely a temporary mismatch of labor’s skills and the needs of employers – rather than a permanent dynamic of today’s economy.
As the Journal says, this optimistic reading also gets to the idea of why the job market is taking so long to recover: Workers switching industries to land new jobs have slowed the hiring process.
But a slow hiring process is better than none at all, and another takeaway is that workers in industries that were whacked in the last recession aren’t necessarily sentenced to long-term unemployment, according to the Journal. They’ll just jump to new fields.
What’s left out this slightly rosy picture is the question of what kinds of jobs are people ultimately landing. The answer seems to be the kinds that pay less than before.
A recent study by Rutgers University showed that more than 50% of workers laid off during the Great Recession who found jobs were making less than their previous gig – and 30% of those were making at least 30% less.
In other words, macro-watching investors should remember that job growth and personal income growth are not the same thing.