BLS Analysis for Recruiters – February 2021

Bob Marshall’s February 2021 BLS Analysis for Recruiters; 3/5/21

February BLS Preface

TBMG Coaching Updates and Product News:

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As many of you know, I have been publishing monthly what I call the “BLS Analysis for Recruiters” for over 11 years now.  And many of you use the information contained in these reports in your presentations to clients and candidates and I encourage that.  That is one of the reasons I spend the time I do to assemble this information. 

I write these analyses for the benefit of our recruitment industry in general and for the members of my distribution list in particular, so use this info as you deem appropriate.

I also write these monthly BLS analyses to not only counterbalance the negative/incorrect press reporting of our general economic state but, more than that, to remind all of my recruitment readers that, at the level we work, there is no unemployment and so we must recruit to find the candidates our client companies so desperately need!

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In the opinion of ex-Dallas Cowboys football coach Tom Landry who coached from 1960-1988, “A coach is someone who tells you what you don’t want to hear, who has you see what you don’t want to see, so you can be who you have always known you could be.”

Is now the time to pick a Coach?

I realize that taking that first step to engage a Coach to help you reach a higher level of production is not as easy as it sounds.  After all, your training investment – and your time – are important and deserve every consideration.  I share your feelings.  I believe that how you approach your recruitment career matters…that you should get what you pay for, and then some…that you should enjoy your time with your Coach as you are benefiting from it…and that you should never settle for the ordinary.

So, for those of you who have been toying with the idea of working with a recruitment coach, now may be the time.  Only you can come to that decision point.

“Teachers open the door; but you must enter by yourself”—Chinese Proverb

When considering ‘individual change management’, consider this theosophical proverb: When the student is ready, the teacher will appear!”

“Bob Marshall is a speaker’s speaker and a trainer’s trainer.  He has a gift for taking the cornerstones of the business and compelling people and teams to not only hone their skills but to execute. We’ve had Bob engage our teams a number of times over the last few years and our groups always come away more focused on the core and more energized to perform. Come ready to learn because this man knows the business and will make you better!”

—David Alexander, President, Soliant, January 2017


Many of you continue to correspond with me about these monthly BLS analyses and have asked if it is OK to use them in your presentations.  The answer is, of course, yes!  That is why I spend the time to assemble this information.  I would encourage any of you who have that desire to weave any of the information I have printed below into your presentations.  I write these analyses for the benefit of our recruitment industry in general and for the members of my distribution list in particular.  So, use this info as you deem appropriate.

I also write these monthly BLS analyses to not only counterbalance the negative/incorrect press reporting of our general economic state but, more than that, to remind all of my recruitment readers that, at the level we work, there is no unemployment and so we must recruit to find the candidates our client companies so desperately need!

So, to my recruiter colleagues, get out there and do what your name implies…RECRUIT!  When your client companies have unique and difficult positions to fill, they need you.  When they are being picky, they need you.  When they are longing for more production from fewer employees, they need you.  Go fill those needs.  These should be the halcyon days in the recruitment arena!

Finally, always remember that we are not in an HR business, but in a ‘circumventing the time factor in the hiring sequence’ business—and adding value to our client companies.

IT Jobs Continue Improving Trend in January, Could Return to Year-Over-year Growth Within Next Few Months

Daily News, February 16, 2021

IT employment rose by 0.5% in January to a total of nearly 5,300,000 jobs, according to the TechServe Alliance, a trade association of IT and engineering staffing and solutions firms.  Still, IT employment remained down by 1.3%, or 70,300 jobs, since before the start of the pandemic in January 2020. 

TechServe Alliance CEO Mark Roberts said the increase in employment is good news even if jobs haven’t yet returned to pre-Covid levels. 

“We have made extraordinary progress in recovering the jobs lost in the spring and early summer,” Roberts said.  “Despite weakness in other parts of the jobs market, IT employment remains a bright spot given the critical role IT professionals are playing in digital transformation and enabling many sectors of the economy to continue to operate through remote work.” 

He noted IT staffing jobs have regained almost three-quarters of the jobs lost as a result of Covid-19. 

“If IT jobs growth continues at the current pace, I anticipate we will have regained all of the IT jobs lost and will post growth on a year-over-year basis within the next few months,” Roberts said.  “By contrast, the overall jobs market is, unfortunately, expected to take years to fully recover.” 

Separately, engineering employment rose by 0.13% in January when compared to December for a total of nearly 2,600,000 jobs.  However, engineering jobs are still down by 74,900 year over year.

58% of Hiring Decision-Makers Expect Average Wage at their Companies to Rise

Daily News, February 12, 2021

More than half of US hiring decision-makers, 58%, expect the average wage at their companies to increase this year, according to a poll commissioned by Express Employment Professionals.  While 30% anticipate no change in pay, only 7% forecast a decrease.

Of those who expect wages to increase, 55% said the increases will be performance-based, 53% said increases will be based on cost of living and 40% said increases will be based on market pay rates.

“Controlling the Covid-19 pandemic continues to be the largest factor standing in the way of a full recovery, so I’m very pleased to see businesses are optimistic for hiring to continue picking up,” Express CEO Bill Stoller said.  “Businesses now need to take a look at what they can afford to hire, and retain, the best and brightest for their operations.”

While a similar proportion of small companies (2 to 9 employees) anticipate the average wage to increase (42%) or remain flat (44%) in 2021, about two-thirds of the largest companies anticipate wages to increase (50 to 99 employees, 64%; 100 to 499 employees, 63%; 500-plus employees, 68%).

There’s also been talk about a nationwide $15 minimum wage.  A Harris poll in January found that 66% of Americans supported this idea.  In announced companies’ plans to raise wages, Express also looked into the $15 question and found some concerns.

“The impact of a federally mandated minimum wage would be different in every local area, as wages and cost of living can vary so drastically across the country,” said David Robb, director of operations for the Express franchise in Grand Rapids, Michigan.  “I think it could be particularly harmful for smaller businesses who may not have the profit margins or capital to adjust their business models to stay profitable with a mandated increase in wages.”

Robb said he has seen wages for entry-level positions increase significantly over the last 2 years.  Despite a state minimum wage of $9.65 per hour, very few positions start below $13.

“At the heart of the minimum wage discussion is providing a living wage for anyone who has a job,” Robb said.  “While … a valid and admirable goal, and something I strongly support, I think the solution to achieve this is much more complicated than just a mandated minimum wage increase.”

Third of Companies Stretch Out Hiring Process

Daily News, February 10, 2021

A third of companies “breadcrumb,” or string along, job applicants by taking more time to hire in the current environment, according to a survey by Robert Half International Inc.

Cities with employers taking more time to hire included San Diego, with 48% of managers saying they are taking more time; Boston, at 47%; and Dallas and Sacramento, California, at 46% each.

“By stretching out the hiring process, companies waste critical time and resources and may lose out on the best talent,” said Paul McDonald, senior executive director at Robert Half.  “Employers who are transparent with candidates and move efficiently through the process will create a positive experience for potential hires and gain a recruiting edge.”

A separate survey of workers found that 62% said they lose interest in a job if they don’t hear back from an employer within 2 weeks after the initial interview.  That jumps to 77% if there is no status update within 3 weeks.

If workers feel they are being breadcrumbed by hiring managers, here is what they will do:

  • Ghost the employer and drop out of the process: 49%
  • Blacklist the company and refuse to consider them for future opportunities: 41%
  • Vent about the experience using personal social media accounts: 27%
  • Leave a negative comment anonymously on review sites: 26%

The surveys included responses from more than 2,100 senior managers whose organization hired new staff during the pandemic and more than 1,000 workers.  The surveys took place from Nov. 19, 2020, to Jan. 25, 2021.

Jobs Lost During COVID Could All Return by 2022, Zandi says (Yahoo Finance Live)

Daily News, February 8, 2021

All the jobs lost during the pandemic could be back by the spring of 2023, Moody’s Analytics Chief Economist Mark Zandi told “Yahoo Finance Live.”

“I think we’ll get all the jobs back that we lost in the pandemic recession by the spring of 2023,” Zandi said.  “It would be quite an achievement, but one we can achieve.”

The new ADP/Moody’s National Employment Report: Over 76% of all new job growth in February 2021 came from Small and Medium-size Companies!

March 3, 2021

Private sector employment increased by 117,000 jobs from January to February according to the February ADP National Employment Report.  Broadly distributed to the public each month, free of charge, the ADP NER is produced by the ADP Research Institute in collaboration with Moody’s Analytics.  The report, which is derived from ADP’s actual payroll data, measures the change in total nonfarm private employment each month on a seasonally-adjusted basis.

The matched sample used to develop the ADP National Employment Report® was derived from ADP payroll data, which represents 460,000 U.S. clients employing nearly 26,000,000 workers in the U.S.  The January total of jobs added was revised from

174,000 to 195,000.

Total U.S. Nonfarm Private Employment:             117,000

By Company Size

Small businesses:                               32,000

1-19 employees                                   21,000

20-49 employees                                 12,000

Medium businesses:                          57,000

50-499 employees                               57,000

Large businesses:                             28,000

500-999 employees                             33,000

1,000+ employees                             <-5,000>

By Sector

I.  Goods-producing:                                       <-14,000>

A.  Natural resources/mining                                                  3,000

B.  Construction                                                                   <-3,000>

C.  Manufacturing                                                              <-14,000>

II.  Service-providing:                                       131,000

A.  Trade/transportation/utilities                                             48,000

B.  Information                                                                      <-3,000>

C.  Financial activities                                                                                  0

D.  Professional/business services                                           22,000

                        1.  Professional/technical services                               10,000

                        2.  Management of companies/enterprises                            0

                        3.  Administrative/support services                             12,000

            E.  Education/health services                                                   35,000

                        1.  Health care/social assistance                                   32,000

                        2.  Education                                                                  3,000

            F.  Leisure/hospitality                                                              26,000

            G.  Other services                                                                       3,000

Franchise Employment

Franchise Jobs                                     35,500

“The labor market continues to post a sluggish recovery across the board,” said Nela Richardson, chief economist, ADP.  “We’re seeing large-sized companies increasingly feeling the effects of COVID-19, while job growth in the goods producing sector pauses.  With the pandemic still in the driver’s seat, the service sector remains well below its pre-pandemic levels; however, this sector is one that will likely benefit the most over time with reopening’s and increased consumer confidence.”

(The March 2021 ADP National Employment Report will be released at 8:15 a.m. ET on March 31, 2021.)

Due to the important contribution that small businesses make to economic growth, employment data that is specific to businesses with 49 or fewer employees is reported each month in the ADP Small Business Report®, a subset of the ADP National Employment Report.

February 2021 Small Business Report Highlights

Total Small Business Employment:             32,000

●By Size  
►1-19 employees 21,000
►20-49 employees 12,000
●By Sector for 1-49 Employees  
►Goods Producing <-16,000>
►Service Producing 48,000
●By Sector for 1-19 Employees  
►Goods Producing <-11,000>
►Service Producing 32,000
●By Sector for 20-49 Employees  
►Goods Producing <-5,000>
►Service Producing 16,000

Bottom-line:  To my audience of recruiters, always remember this:  Our ‘bread and butter’, especially on the contingency side of the house, has historically been, and continues to be, small and medium-sized client companies.  Along with the large companies, these companies need to be in included in your niche!

Job Openings and Labor Turnover Survey – December 2020

February 9, 2021    

The number of job openings was little changed at 6,600,000 on the last business day of December, the U.S. Bureau of Labor Statistics reported today.  Hires decreased to 5,500,000 while total separations were little changed at 5,500,000.  Within separations, the quits rate and layoffs and discharges rate were little changed at 2.3% and 1.3%, respectively.  This release includes estimates of the number and rate of job openings, hires, and separations for the total nonfarm sector, by industry, and by 4 geographic regions.

Job Openings

On the last business day of December, the number and rate of job openings were little changed at 6,600,000 and 4.5%, respectively.  Job openings increased in professional and business services (+296,000).  Job openings decreased in state and local government, excluding education (-65,000); arts, entertainment, and recreation (-50,000); and nondurable goods manufacturing (-30,000).  The number of job openings was little changed in all 4 regions.

Over the year, the number of job openings (not seasonally adjusted) was little changed in December.  Job openings decreased in a number of industries over the year with the largest decreases in state and local government, excluding education; arts, entertainment, and recreation; and information.  The job openings level increased in a number of industries over the year with the largest increases in professional and business services; nondurable goods manufacturing; and transportation, warehousing, and utilities.  The

number of job openings increased in the South region.


Coronavirus (COVID-19) Pandemic Impact on December 2020 JOLTS Data                                                                                                                                                                  |

Data collection for the Job Openings and Labor Turnover Survey was affected by the coronavirus (COVID-19) pandemic.



In December, the number of hires decreased to 5,500,000 million (-396,000), and the hires rate decreased to 3.9%.  Hires decreased in accommodation and food services

(-221,000); transportation, warehousing, and utilities (-133,000); and arts, entertainment, and recreation (-82,000).  Hires increased in retail trade (+94,000).  The number of hires decreased in the South region.

The number of hires in December (not seasonally adjusted) edged down over the year (-237,000).  Hires decreased in accommodation and food services; arts, entertainment, and recreation; and educational services.  Hires increased in a number of industries with the largest increases in wholesale trade, nondurable goods manufacturing, and durable goods manufacturing.  The number of hires decreased in the West region.


Total separations includes quits, layoffs and discharges, and other separations.  Quits are generally voluntary separations initiated by the employee.  Therefore, the quits rate can serve as a measure of workers’ willingness or ability to leave jobs.  Layoffs and discharges are involuntary separations initiated by the employer.  Other separations includes separations due to retirement, death, disability, and transfers to other locations of the same firm.

In December, the number of total separations was little changed at 5,500,000, and the total separations rate was little changed at 3.8%.  The total separations level decreased in federal government (-86,000).  Total separations increased in arts, entertainment, and recreation (+68,000).  Total separations were little changed in all 4 regions.

Over the year, the number of total separations (not seasonally adjusted) was little changed.  Total separations increased in a number of industries with the largest increases in accommodation and food services; nondurable goods manufacturing; and state and local government, excluding education.  Total separations decreased in transportation, warehousing, and utilities and in mining and logging.  The number of total separations was little changed in all 4 regions.

In December, the quits level and rate were little changed at 3,300,000 and 2.3%, respectively.  The number of quits decreased in federal government (-4,000).  The number of quits increased in the Midwest region.

Over the year, the number of quits (not seasonally adjusted) was little changed.  Quits decreased in accommodation and food services and state and in local government education.  Quits increased in durable goods manufacturing.  The number of quits decreased in the West region.

The number of layoffs and discharges decreased to 1,800,000 (-243,000) in December.  The layoffs and discharges rate was little changed at 1.3%.  The number of layoffs and discharges decreased in a number of industries with the largest decreases in federal government (-87,000); transportation, warehousing, and utilities (-52,000); and health care and social assistance (-42,000).  Layoffs and discharges increased in arts, entertainment, and recreation (+50,000).  Layoffs and discharges decreased in the Midwest region.

Over the year, the layoffs and discharges level (not seasonally adjusted) was little changed.  Layoffs and discharges increased in accommodation and food services; educational services; and state and local government, excluding education.  The number of layoffs and discharges decreased in a number of industries with the largest decreases in construction; transportation, warehousing, and utilities; and retail.  The number of layoffs and discharges decreased over the year in the South region.

The number of other separations increased in December to 362,000 (+74,000).  Other separations increased in a number of industries with the largest increases in health care and social assistance (+15,000); state and local government, excluding education (+8,000); and nondurable goods manufacturing (+7,000).  The other separations level increased in the South region.

Over the year, the other separations level (not seasonally adjusted) was little changed.  Other separations decreased in durable goods manufacturing.  The number of other separations increased in federal government and in educational services.  The number of other separations was little changed in all 4 regions.

Net Change in Employment

Large numbers of hires and separations occur every month throughout the business cycle.  Net employment change results from the relationship between hires and separations.  When the number of hires exceeds the number of separations, employment rises, even if the hires level is steady or declining.  Conversely, when the number of hires is less than the number of separations, employment declines, even if the hires level is steady or rising.

Over the 12 months ending in December, hires totaled 70,200,000 and separations totaled 75,700,000, yielding a net employment loss of 5,500,000.  These totals include workers who may have been hired and separated more than once during the year.


The Job Openings and Labor Turnover Survey estimates for January 2021 are scheduled to be released on Thursday, March 11, 2021 at 10:00 a.m. (ET).

As we recruiters know, that 6,600,000 number only represents 20% of the jobs currently available in the marketplace.  The other 80% of job openings are unpublished and are filled through networking or word of mouth or by using a RECRUITER.   So, those 6,600,000 published job openings now become a total of 33,000,000 published AND hidden job orders.



Online Labor Demand Rose in January

February 10, 2021

The Conference Board®-Burning Glass® Help Wanted OnLine® (HWOL) Index rose in January and now stands at 101.1 (July 2018=100), up from 98.2 in December.  The Index declined 3.7% from November to December and is down 7.7% from a year ago.

The Help Wanted OnLine® Index is produced in collaboration with Burning Glass Technologies, the global pioneer in real-time labor market data and analysis.  This recent collaboration enhances the Help Wanted OnLine® program by providing additional insights into important labor market trends.


Prior to 2020, The Conference Board constructed the HWOL Index based solely on online job ads over time.  Using a methodology designed to reduce non-economic volatility contributed by online job sources, the HWOL Index served an effective measure of changes in labor demand over time.

Beginning January 2020, the HWOL Index was refined as an estimate of change in job openings (based on BLS JOLTS), using a series of econometric models which incorporate job ads with other macroeconomic indicators such as employment and aggregate hours worked.  By adopting a modeled approach which combines other data sources with data on online job ads, the HWOL Index more accurately tracks important movements in the labor market. 

The Conference Board®-Burning Glass® Help Wanted OnLine® (HWOL) Index measures changes over time in advertised online job vacancies, reflecting monthly trends in employment opportunities across the US.  The HWOL Data Series aggregates the total number of ads available by month from the HWOL universe of online job ads.  Ads in the HWOL universe are collected in real-time from over 50,000 online job domains including traditional job boards, corporate boards, social media sites, and smaller job sites that serve niche markets and smaller geographic areas.

Like The Conference Board’s long-running Help Wanted Advertising Index of print ads (which was published for over 55 years and discontinued in July 2008), Help Wanted OnLine® measures help wanted advertising, i.e. labor demand.  The HWOL Data Series began in May 2005 and was revised in December 2018.  With the December 2018 revision, The Conference Board released the HWOL Index, improving upon the HWOL Data Series’ ability to assess local labor market trends by reducing volatility and non-economic noise and improving correlation with local labor market conditions.

In 2019, the Help Wanted OnLine® program partnered with Burning Glass Technologies, Inc., the new sole provider of online job ad data for HWOL.  With the partnership, the HWOL Data Series has been revised historically to reflect a new universe and methodology of online job advertisements and therefore cannot be used in conjunction with the pre-revised HWOL Data Series.  The HWOL Data Series begins in January 2015 and the HWOL Index begins in December 2005.  HWOL Index values prior to 2020 are based on job ads collected by CEB, Inc.

Those using this data are urged to review the information on the database and methodology available on The Conference Board website and contact us with questions and comments.

About The Conference Board

The Conference Board is the member-driven think tank that delivers trusted insights for what’s ahead. Founded in 1916, we are a non-partisan, not-for-profit entity holding 501 (c) (3) tax-exempt status in the United States.

About Burning Glass Technologies, Inc.

Burning Glass Technologies delivers job market analytics that empower employers, workers, and educators to make data-driven decisions.  Powered by the world’s largest and most sophisticated database of labor market data and talent, Burning Glass Technologies analyzes hundreds of millions of job postings and real-life career transitions to provide insight into labor market patterns.  Users of our products include corporate human resources departments, market analysts and employment services firms as well as the federal, state, and local labor market analysts that use HWOL.

The next release for February 2021 is Wednesday, March 10 at 10 AM.

U-6 Update

In February 2021, the regular unemployment rate fell 0.1% to 6.2% and the broader U-6 measure remained at 11.1%.  Both of these percentages are still almost totally due to the COVID-19 economic shutdown across the U.S and the slow ‘Reopening’.

The above 11.1% is referred to as the U-6 unemployment rate (found in the monthly BLS Employment Situation Summary, Table A-15; Table A-12 in 2008 and before).  It counts not only people without work seeking full-time employment (the more familiar U-3 rate), but also counts “marginally attached workers and those working part-time for economic reasons.”  Note that some of these part-time workers counted as employed by U-3 could be working as little as an hour a week.  And the “marginally attached workers” include those who have gotten discouraged and stopped looking, but still want to work.  The age considered for this calculation is 16 years and over.

Here is a look at the February U-6 numbers for the previous 18 years:

February 2020             7.0%

February 2019             7.2%

February 2018             8.2%

February 2017             9.2%

February 2016             9.8%

February 2015             11.0%

February 2014             12.6%

February 2013             14.3%

February 2012             15.0%

February 2011             15.9%

February 2010             16.8%

February 2009             15.0%

February 2008             9.0%

February 2007             8.1%

February 2006             8.4%

February 2005             9.3%

February 2004             9.7%

February 2003             10.1%

The February 2021 BLS Analysis

Total nonfarm payroll employment rose by 379,000 in February, and the unemployment rate was little changed at 6.2%, the U.S. bureau of Labor Statistics reported today.  The labor market continued to reflect the impact of the coronavirus (COVID-19) pandemic.  In February, most of the job gains occurred in leisure and hospitality, with smaller gains in temporary help services, health care and social assistance, retain trade, and manufacturing.  Employment declined in state and local government education, construction, and mining.
The change in total nonfarm payroll employment for December was revised down by 79,000, from -227,000 to -306,000, and the change for January was revised up by 117,000, from +49,000 to +166,000.  With these revisions, employment in December and January combined was 38,000 higher than previously reported.  (Monthly revisions result from additional reports received from businesses and government agencies since the last published estimates and from the recalculation of seasonal factors.)

The unemployment rate is also published by the BLS.  That rate is found by dividing the number of unemployed by the total civilian labor force.  On March 5th, 2021, the BLS published the most recent unemployment rate for February 2021 of 6.2% (actually, it is 6.224% down by 0.101% from 6.325% in January.

The unemployment rate was determined by dividing the unemployed of 9,972,000

(–down from the month before by 158,000—since February 2020, this number has increased by 4,255,000) by the total civilian labor force of 160,211,000 (up by 50,000 from January 2020).  Since February 2020, our total civilian labor force has decreased by 4,237,000 workers.

(The continuing ‘Strange BLS Math’ saga—after a detour in December 2016 when the BLS {for the first time in years} DECREASED the total Civilian Noninstitutional Population—this month the BLS decreased this total to 260,918,000.  This is an increase of 67,000 from last month’s decrease of 379,000.  In one year, this population has increased by 1,290,000.  For the last 3 years the Civilian Noninstitutional Population has increased each month—except in December 2016, December 2018, December 2019, & December 2020—by…)

Up from January 2021by67,000
Down from December 2020by379,000
Up from November 2020by145,000
Up from October 2020by160,000
Up from September 2020by183,000
Up from August 2020by184,000
Up from July 2020by185,000
Up from June 2020by169,000
Up from May 2020by157,000
Up from April 2020by151,000
Up from March 2020by138,000
Up from February 2020by130,000
Up from January 2020by126,000
Down from December 2019by679,000
Up from November 2019by161,000
Up from October 2019by175,000
Up from September 2019by207,000
Up from August 2019by206,000
Up from July 2019by207,000
Up from June 2019by188,000
Up from May 2019by176,000
Up from April 2019by168,000
Up from March 2019by156,000
Up from February 2019by145,000
Up from January 2019by153,000
Down from December 2018by649,000
Up from November 2018by180,000
Up from October 2018by194,000
Up from September 2018by224,000
Up from August 2018by224,000
Up from July 2018by223,000
Up from June 2018by201,000
Up from May 2018by188,000
Up from April 2018by182,000
Up from March 2018by175,000
Up from February 2018by163,000

This month the BLS has increased the Civilian Labor Force to 160,211,000 (up from January by only 50,000, mainly due to the slow reopening of the economy).

Subtract the second number (‘civilian labor force’) from the first number (‘civilian noninstitutional population’) and you get 100,708,000 ‘Not in Labor Force’—up by 18,000 from last month’s 100,690,000.  In one year, this NILF population has increased by 5,528,000.  The government tells us that most of these NILFs got discouraged and just gave up looking for a job.  My monthly recurring question is: “If that is the case, how do they survive when they don’t earn any money because they don’t have a job?  Are they ALL relying on the government to support them??”

This month, our Employment Participation Rate—the population 16 years and older working or seeking work—remained at 61.4%.  This ‘reopening’ rate is 1.0% below the historically low rate of 62.4% recorded in September 2015—and, before that, the rate recorded in October 1977—9 months into Jimmy Carter’s presidency—almost 40 years ago!

Final take on these numbers:  Fewer people looking for work will always bring down the unemployment rate.

Anyway, back to the point I am trying to make.  On the surface, these new unemployment rates are scary, but let’s look a little deeper and consider some other numbers.

The unemployment rate includes all types of workers—construction workers, government workers, etc.  We recruiters, on the other hand, mainly place management, professional and related types of workers.  That unemployment rate in February was 3.2% (this rate was .5% lower than last month’s 3.7%).  Or you can look at it another way.  We usually place people who have college degrees.  That unemployment rate in February was3.8% (this rate was .2% lower than last month’s 4.0%).

Now stay with me a little longer.  This gets better.  It’s important to understand (and none of the pundits mention this) that the unemployment rate, for many reasons, will never be 0%, no matter how good the economy is.  Without boring you any more than I have already, let me add here that Milton Friedman (the renowned Nobel Prize-winning economist), is famous for the theory of the “natural rate of unemployment” (or the term he preferred, NAIRU, which is the acronym for Non-Accelerating Inflation Rate of Unemployment).  Basically, this theory states that full employment presupposes an ‘unavoidable and acceptable’ unemployment rate of somewhere between 4-6% with it.  Economists often settle on 5%, although the “New Normal Unemployment Rate” has been suggested to fall at 6.7%.

Nevertheless (if you will allow me to apply a ‘macro’ concept to a ‘micro’ issue), if this rate is applied to our main category of Management, Professional and Related types of potential recruits, and/or our other main category of College-Degreed potential recruits, because of the COVID-19 shutdown, we are not that far above the 4-6% threshold for full employment…and that will change as soon as we all return to work!


“The economic goal of any nation, as of any individual, is to get the greatest results with the least effort.  The whole economic progress of mankind has consisted in getting more production with the same labor…Translated into national terms, this first principle means that our real objective is to maximize production.  In doing this, full employment—that is, the absence of involuntary idleness—becomes a necessary by-product.  But production is the end, employment merely the means.  We cannot continuously have the fullest production without full employment.  But we can very easily have full employment without full production.”

–Economics in One Lesson, by Henry Hazlitt, Chapter X, “The Fetish of Full Employment”

On February 25th, the US Bureau of Economic Analysis (BEA) announced the real gross domestic product (GDP) increased at an annual rate of 4.1% in the fourth quarter of 2020, according to the “second” estimate released by the Bureau of Economic Analysis.  In the third quarter, real GDP increased 33.4%.

The GDP estimate released today is based on more complete source data than were available for the “advance” estimate issued last month.  In the advance estimate, the increase in real GDP was 4.0%.  With the second estimate, upward revisions to residential fixed investment, private inventory investment, and state and local government spending were partly offset by a downward revision to personal consumption expenditures (PCE).

The increase in real GDP reflected increases in exports, nonresidential fixed investment, PCE, residential fixed investment, and private inventory investment that were partly offset by decreases in state and local government spending and federal government spending.  Imports, which are a subtraction in the calculation of GDP, increased.

COVID-19 Impact on the Fourth-Quarter 2020 GDP Estimate

The increase in fourth quarter GDP reflected both the continued economic recovery from the sharp declines earlier in the year and the ongoing impact of the COVID-19 pandemic, including new restrictions and closures that took effect in some areas of the United States.  The full economic effects of the COVID-19 pandemic cannot be quantified in the GDP estimate for the fourth quarter of 2020 because the impacts are generally embedded in source data and cannot be separately identified.

The increase in exports primarily reflected an increase in goods (led by industrial supplies and materials).  The increase in nonresidential fixed investment reflected increases in all components, led by equipment (mainly transportation equipment).

The increase in PCE was more than accounted for by spending on services (led by health care); spending on goods decreased (led by food and beverages).  The increase in residential fixed investment primarily reflected investment in new single-family housing.  The increase in private inventory investment was more than accounted for by an increase in manufacturing that was partly offset by a decrease in retail trade.

Updates to GDP

In the second estimate for the fourth quarter, real GDP increased 0.1% more than in the advance estimate issued last month, primarily reflecting upward revisions to residential fixed investment, private inventory investment, and state and local government spending that were partly offset by a downward revision to PCE.

GDP for 2020

Real GDP decreased <-3.5%> in 2020 (from the 2019 annual level to the 2020 annual level), compared with an increase of 2.2% in 2019.

The decrease in real GDP in 2020 reflected decreases in PCE, exports, private inventory investment, nonresidential fixed investment, and state and local government that were partly offset by increases in federal government spending and residential fixed investment. Imports decreased.

The decrease in PCE in 2020 was more than accounted for by a decrease in services (led by food services and accommodations, health care, and recreation services).  The decrease in exports reflected decreases in both services (led by travel) and goods (mainly non-automotive capital goods).  The decrease in private inventory investment reflected widespread decreases led by retail trade (mainly motor vehicle dealers) and wholesale trade (mainly durable goods industries).  The decrease in nonresidential fixed investment reflected decreases in structures (led by mining exploration, shafts, and wells) and equipment (led by transportation equipment) that were partly offset by an increase in intellectual property products (more than accounted for by software).  The decrease in state and local government spending reflected a decrease in consumption expenditures (led by compensation).

The increase in federal government spending reflected an increase in nondefense consumption expenditures (led by an increase in purchases of intermediate services that supported the processing and administration of Paycheck Protection Program loan applications by banks on behalf of the federal government).  The increase in residential fixed investment primarily reflected increases in improvements as well as brokers’ commissions and other ownership transfer costs.

*          *          *

Next release, March 25, 2021 at 8:30 A.M. EST
Gross Domestic Product (Third Estimate) Fourth Quarter and Year 2020


‘Unemployment’ is an emotional ‘trigger’ word…a ‘third rail’, if you will.  It conjures up negative thoughts.  But it is important to realize that, while we want everyone who wants a job to have the opportunity to work, unemployment can never be zero and, in fact, can be disruptive to an economy if it gets too close to zero.  Very low unemployment can actually hurt the economy by creating an upward pressure on wages which invariably leads to higher production costs and prices.  This can lead to inflation.  The lowest the unemployment rate has been in the US was 2.5%.  That was in May and June 1953 when the economy overheated due to the Korean War.  When this bubble burst, it kicked off the Recession of 1953.  A healthy economy will always include some percentage of unemployment.

There are five main sources of unemployment:

1.  Cyclical (or demand-deficient) unemployment – This type of unemployment fluctuates with the business cycle.  It rises during a recession and falls during the subsequent recovery.  Workers who are most affected by this type of unemployment are laid off during a recession when production volumes fall, and companies use lay-offs as the easiest way to reduce costs.  These workers are usually rehired, some months later, when the economy improves.

2.  Frictional unemployment – This comes from the normal turnover in the labor force.  This is where new workers are entering the workforce and older workers are retiring and leaving vacancies to be filled by the new workers or those re-entering the workforce.  This category includes workers who are between jobs.

3.  Structural unemployment – This happens when the skills possessed by the unemployed worker don’t match the requirements of the opening—whether those be in characteristics and skills or in location.  This can come from new technology or foreign competition (e.g., foreign outsourcing).  This type of unemployment usually lasts longer than frictional unemployment because retraining, and sometimes relocation, is involved.  Occasionally jobs in this category can just disappear overseas.

4.  Seasonal unemployment – This happens when the workforce is affected by the climate or time of year.  Construction workers and agricultural workers aren’t needed as much during the winter season because of the inclement weather.  On the other hand, retail workers experience an increase in hiring shortly before, and during, the holiday season, but can be laid off shortly thereafter.

5.  Surplus unemployment – This is caused by minimum wage laws and unions.  When wages are set at a higher level, unemployment can often result.  Why?  To keep within the same payroll budget, the company must let go of some workers to pay the remaining workers a higher salary.

Other factors influencing the unemployment rate:

1.  Length of unemployment – Some studies indicate that an important factor influencing a worker’s decision to accept a new job is directly related to the length of the unemployment benefit they are receiving.  Currently, in 2019, workers in most states are eligible for up to 26 weeks of benefits from the regular state-funded unemployment compensation program.  One state (MT) offers more and ten states offer less.  Studies suggest that additional weeks of benefits reduce the incentive of the unemployed to seek and accept less-desirable jobs.

2.  Changes in GDP – Since hiring workers takes time, the improvement in the unemployment rate usually lags the improvement in the GDP.


Now back to the issue at hand, namely the recruiting, and placing, of professionals and those with college degrees.

If you look at the past 21 years of unemployment in the February “management, professional and related” types of worker category, you will find the following rates:

February 2020             1.8%

February 2019             2.0%

February 2018             2.0%

February 2017             2.1%

February 2016             2.4%

February 2015             2.7%

February 2014             3.2%

February 2013             3.8%

February 2012             4.2%

February 2011             4.4%

February 2010             4.8%

February 2009             3.9%

February 2008             2.2%

February 2007             1.9%

February 2006             2.1%

February 2005             2.5%

February 2004             2.7%

February 2003             3.1%

February 2002             2.8%

February 2001             1.8%

February 2000             1.6%

Here are the rates, during those same time periods, for “college-degreed” workers:

February 2020             1.9%

February 2019             2.2%

February 2018             2.2%

February 2017             2.4%

February 2016             2.5%

February 2015             2.7%

February 2014             3.4%

February 2013             3.9%                                       

February 2012             4.2%

February 2011             4.3%

February 2010             4.9%

February 2009             4.2%

February 2008             2.1%

February 2007             1.9%

February 2006             2.2%

February 2005             2.4%

February 2004             2.9%

February 2003             3.0%

February 2002             2.8%

February 2001             1.6%

February 2000             1.6%

The February 2021 rates for these two categories, 3.2% and 3.8%, respectively, are still fairly high because so many workers are sheltering in place in their homes and not going to work.  But regardless, these unemployment numbers usually include a good number of job hoppers, job shoppers and rejects.  We, on the other hand, are engaged by our client companies to find those candidates who are happy, well-appreciated, making good money and currently working and we entice them to move for even better opportunities—especially where new technologies are expanding.  This will never change.  And that is why, no matter the overall unemployment rate, we still need to MARKET to find the best possible job orders to work and we still need to RECRUIT to find the best possible candidates for those Job Orders.

Below are the numbers for the over 25-year old’s:

Less than H.S. diploma – Unemployment Rate


H.S. Grad; no college – Unemployment Rate


Some College; or AA/AS – Unemployment Rate


BS/BS + – Unemployment Rate


Management, Professional & Related – Unemployment Rate


Or employed…(,000)


And unemployed…(,000)


For a total Management, Professional & Related workforce of…(,000)


Management, Business and Financial Operations – Unemployment Rate


Professional & Related – Unemployment Rate


Sales & Related – Unemployment Rate