Last month I noted that the average duration of job vacancies was at a record high. Well, we just surpassed that record:
The average job opening went unfilled for 25.1 days in May, the longest duration since at least 2001 (as far back as the data series goes). That compares to a low of 15.3 days in July 2009, about when the recovery officially began.
These numbers are based on a method developed by Steven J. Davis, R. Jason Faberman and John Haltiwanger, and they reflect the average number of working days between when a job is first posted and when an offer is finally accepted. Typically, there is also an additional lag between the fill date and the new employee’s starting date, but that delay is not included in this measure.
In some industries, job openings are staying vacant for much longer than 25 days. In financial services, for example, the typical job opening stayed vacant for about 4o days (compared to a low of 18.4 days in August 2009).
In construction — a sector where some analysts have argued that a skilled-labor shortage has held back the housing market – workers are getting hired on a much shorter time frame. The average construction posting stays open for fewer than 10 days before being filled. Bear in mind though that during the depths of the recession, there was one month when construction jobs stayed open for less than 2 days, likely because there was such a large glut of idle workers and very little work.
The employers that really seem to be dragging their feet these days are big companies: At firms with at least 5,000 employees, the average position stays open an astonishing 68.5 working days.
As I wrote last month, I am skeptical about the skills-mismatch explanation for why jobs are staying vacant longer. A shortage of skilled workers should lead to sharp wage growth as businesses fight over the few qualified applicants out there. We just haven’t seen much evidence of that yet. Other possible explanations for foot-dragging include: uncertainty, about both public policy and the state of the economy; unrealistic employer expectations about what the kinds of qualifications workers should have vs. how much these workers deserve to be paid; and the fact that some larger companies may have gutted their H.R. departments during the recession.