White Collar Jobs Are Scarcer as Labor Markets Get Tighter

That’s the official unemployment rate, called the U-3. However, it doesn’t include discouraged workers, those marginally attached to the labor force, or people employed part-time for economic reasons and not choice. Put it all together and get the U-6 rate of 7.8%.

As the Journal wrote, the extended unemployment paid is “largely in high-paying, white-collar jobs.” That means business consulting, law, high-tech, and media. To see the signs, take a stroll through LinkedIn. You can see many examples of people, well-educated and with extensive career experience, who haven’t been able to find a job even after many months. Some who are desperate will discuss their desperation as they’re on the brink of losing their homes.

Just a couple of years ago, the number of unemployed people available per job was about 0.5, as the Bureau of Labor Statistics reported, meaning there were about two jobs per person, leaving employers the desperate ones and employees the ones with negotiation power. Now the number is 0.9 or 1.1 jobs per person. However, not all people are qualified for all jobs. Not all people are within commuting distance of all the employment. And so, the jobs-per-person figure misrepresents reality, although it provides an upper bound.

The weight of the wait falls on those who had been in high demand when big companies were hiring as fast as they could. Now that conditions have turned, companies are cutting back on staff and even replacing them with artificial intelligence systems.

The effects on landlords might not be so strong, though. The office market is one where owners of trophy or Class-A properties have seen pricing power and lower vacancy rates because of demand. While tenants of those buildings might be able to get people to return, those in Class-B or Class-C buildings will have greater difficulty, as they may not be favored by the companies that are tightening employment.