Tales From a Tight Labor Market: Why the Tech Skills Gap Is Smaller Than You Think and More

The world of work is a complex and rapidly changing place, but the right data accurately interpreted can help us all understand what’s going on. Knowledge is power, and informed decision making is the most powerful of all.

Here at Indeed we are fortunate to have the Indeed Hiring Lab, a dedicated global team of researchers helping us make sense of what’s going on out there, delivering insights about the labor market and helping employers and job seekers understand today’s work world.

In this post, we’re going to take a look at some of their recent findings and insights. But first, let’s take a look at those jobs numbers …

Labor market keeps on truckin’

Here we see good news: In March the U.S. economy added 196,000 jobs, while the unemployment rate was at 3.8%, unchanged from the previous month.

This represented something of a bounceback from a surprising February. Even as some have worried about the direction of the economy overall, the labor market has continued to add jobs at a steady clip. In fact, despite last month’s low number, job growth during this recovery has been remarkably consistent.

That said, it wasn’t all good news: the share of the unemployed who are long-term unemployed was higher than it was at this time last year for the first time in two and a half years. In addition, the share of workers who are stuck in part-time employment but who would prefer full-time work ticked up after finally hitting its low from the previous recovery last month.

Even so, the big picture is positive: A strong labor market continues to provide more economic opportunities for those who had not fully benefited from the recovery. And wage growth continued above 3% for the sixth straight month, perhaps a reflection of employers having to respond to a tight labor market.

What else is new in the world of work? Let’s take a look at some of the Indeed Hiring Lab’s latest findings.

The tech skills gap may be smaller than you think

Almost every day we hear about new technological breakthroughs, whether it has to do with artificial intelligence, self-driving vehicles, space exploration or more. At the rate technology is progressing, it may seem like jobs are changing so quickly in the tech sector that it can be hard for job seekers to keep up — leading to what some employers say is a skills shortage. But all may not be as it seems: Hiring Lab research found that while the tech labor market does face unique challenges, the reality is more nuanced than many may think.

Using Indeed data on job seeker resumes and job postings from 2014 through 2018, the Hiring Lab’s Martha Gimbel and Tara Sinclair found that the mix of tech job postings has actually been changing more slowly than the mix of job postings in the economy overall. The overall job postings on Indeed were 25% different in 2018 than 2014, but tech job postings were only 18% different.

And here’s some good news: It has become easier for employers to find tech talent over the past few years than in other sectors, perhaps due to the increase in tech skill training — such as coding bootcamps — as well as the emphasis on preparing tech workers quickly.

Gimbel and Sinclair also found that tech job seekers are actually better matched to current job opportunities in the field than job seekers are in the overall economy.*

Not so much good news for journalists as postings continue to slide

Waves of layoffs have hit newsrooms across the U.S. at the beginning of this year, affecting digital and print publications such as the Dallas Morning News, BuzzFeed, Huffington Post and Vice. In total, more than 2,000 journalists have lost their jobs.

This, meanwhile, is a long-term trend — Pew Research Center used data from the Bureau of Labor Statistics to estimate a decline of almost 25% in newsroom employment between 2008 and 2017.

Research from the Hiring Lab’s Andrew Flowers provides some new insight into this trend. Growth in journalism job postings lags behind growth in overall postings on Indeed over the last few years, and journalism job postings as a share of all listings fell a steep 30% in the last five years through January 1, 2019. Job postings for “editor” have seen the largest decline, at 40% over the last five years.

However, location matters — some areas are much better than others if you’re looking for journalism jobs. You have a good chance if you look in the New York metro area, which had the highest percentage of journalism job postings last year, at 18%.

As the media landscape continues to transform, we’ll be keeping an eye out for how this story develops.

Wanna see some fast-growing job search terms?

Here at Indeed we like to keep a close eye on what’s up and what’s down in the world of job search, and the fastest-growing job searches on Indeed can give employers some insight into what’s on job seekers’ minds. Recently the Hiring Lab analyzed two years of data on the fastest-growing job searches on Indeed and found that searches containing the terms “full time,” “no experience” and “Amazon” saw particularly strong growth in 2018.

Searches for “Amazon” have spiked following the e-commerce giant’s announcement of a new $15/hour minimum wage last fall. And while this spike followed Amazon’s minimum wage declaration, there has generally been strong interest from job seekers in working for the e-commerce giant.

We saw other trends, of course. The share of all job searches containing the term “full time” was up 56% in December 2018 over the same time the year before. Popular terms we see include “anything full time” and “immediate hire full time.”

Another interesting trend we saw was job seekers looking to enter new fields, ones that require little to no experience. Searches containing the phrase “no experience” have grown 89% compared with December 2016.

Of course, in today’s tight labor market it can be difficult to hire. So for some employers it may make sense to hire less-experienced workers, developing the skills of the workforce they will rely on for possibly years to come, rather than wait for the perfect candidate to just come along.

But wait, there’s more …

It’ll be interesting to see what happens in the world of work in 2019, so stay tuned for future updates on the world of work from the Indeed Hiring Lab! And if you enjoy digging into research, why not check out their site yourself? There’s a wealth of data and insight waiting for you, covering all aspects of the labor market.

*To quantify mismatch, Hiring Lab looked at resumes on Indeed and compared job titles of job seekers from their current or most recent employment with the titles of job postings on Indeed.