It’s finally getting easier to find a job – but only if you’ve got the right skills.
“For all varieties of jobs, it’s a pretty tight market,” said John Slenker, the state Labor Department’s regional economist in Buffalo.
“But you have to have the right skills,” he said. “The greatest thing we’re seeing is a skills mismatch.”
In other words, the strengthening job market isn’t powerful enough to overcome trends that have been shaping hiring and wages for the past few decades.
There’s no question that the job market is steadily improving, even if it’s at a rather modest pace that’s less than half of the national growth rate. We had 4,900 more jobs this February than we did in February 2015.
The local unemployment rate dropped to 5.5 percent in February – the lowest for any February since 2007.
The number of unemployed people fell by almost 16 percent during February to a 14-year low for the month.
And the improved prospects for finding a job has started to bring more discouraged workers back into the labor pool. The local labor force, which had been steadily shrinking since the recession, has grown for four straight months – a sign that workers who had given up their job hunt are starting to look again.
“When you have an economy that’s been that steady and that strong, it should allow workers to find a job if they have good skills,” Slenker said.
But not all workers are created equal, and for the workers at the bottom of the skills pool, today’s labor market is becoming a less hospitable place.
The labor department, for instance, expects about 17,000 advanced manufacturing jobs to come open over the next four years – but most of those jobs that will require technology or training in the skilled trades, such as welders, machinists and electricians.
Economists Jaison R. Abel and Richard Deitz from the Federal Reserve Bank of New York’s Buffalo office detailed the growing gap between the wages earned by college graduates and those without in a study two years ago.
Rob Valletta, an economist from the Federal Reserve Bank of San Francisco, echoed those findings in a study last year. He blamed the growing polarization in earnings on the ever-rising importance of technology in the workplace.
“The skills needed to apply these technologies are often acquired through, or associated with, higher education,” Valletta wrote.
And with the state’s minimum wage now set to rise to $12.50 an hour over the next five years, the job hunt will only get tougher for lesser-skilled workers, as businesses invest even more in labor-saving technology, from ordering kiosks in fast-food restaurants to self-checkout machines in grocery stores and automated production equipment that can replace people who now do simple, repetitive work.
Of course, not all of those jobs will go away. The region has had steady growth in jobs at stores, bars, restaurants and hotels over the past few years.
But the workers in those jobs are at a decided disadvantage. Retail jobs pay about 45 percent less than the region’s $45,060 average annual wage. Food service jobs pay about half of the regional average.
“We can see where the jobs are being created,” said Frederick Floss, a SUNY Buffalo State economist. “They’re not necessarily being created in high-wage industries.”
Education has a huge impact on a worker’s earnings potential. In today’s job market, a high school diploma is the absolute minimum requirement, but even those graduates are at a marked disadvantage compared with workers who have college degrees. And workers without a high school diploma face much higher unemployment and significantly lower pay than high school graduates, Slenker said.
The differences are stark. Workers with less than a high school diploma earned an average of just $493 a week last year and had an unemployment rate of 8 percent – nearly double the national average, according to the U.S. Bureau of Labor Statistics.
Finishing high school boosts that weekly wage by 38 percent to $679 and cuts the jobless rate for those workers to 5.4 percent. Workers with a bachelor’s degree earn two-thirds more than high school graduates and are about half as likely to be unemployed.
So there’s no question that skills and education pay off, both in higher wages and lower unemployment. Apprenticeships and other forms of on-the-job training help, too.
The key, Slenker said, is to make sure your skills and training keep up with the times.