Take Those JOLTS Numbers With a Grain of Salt

If you suspect that the government’s JOLTS (job openings and labor turnover survey) number is off, you may have good reason. That’s because some of the data and constraints the Bureau of Labor Statistics (BLS) uses to make its calculations can be deceiving. Consider how the JOLTS number is calculated.

According to the BLS, JOLTS defines Job Openings as all positions that are open (not filled) on the last business day of the month. A job is "open" only if it meets all three of the following conditions:

1. A specific position exists and there is work available for that position. The position can be full-time or part-time, and it can be permanent, short-term, or seasonal, and
2. The job could start within 30 days, whether or not the establishment finds a suitable candidate during that time, and
3. There is active recruiting for workers from outside the establishment location that has the opening.

“Active recruiting,” as defined by JOLTS, is “the establishment is taking steps to fill a position. It may include advertising in newspapers, on television, or on radio; posting Internet notices; posting 'help wanted' signs; networking with colleagues or making ‘word of mouth’ announcements; accepting applications; interviewing candidates; contacting employment agencies; or soliciting employees at job fairs, state or local employment offices, or similar sources.”

When it comes to collecting the actual data, on the last business day of each month approximately 21,000 non-farm businesses and government agencies report their open jobs data to JOLTS. According to a BLS representative, the agency accepts the information as is, no questions asked, unless a gross error is suspected. This opens the door for many jobs to be counted as “new” more than once because the average time to fill a job is more than 30 days — it’s  44 days according to the Society for Human Resources Management.

"Time-to-hire has been trending up, and is about 40 percent higher than pre-pandemic," Stephen Bronars, an economist and partner at Edgeworth Economics told SHRM. He predicted that it could be closer to 50 days.

The Tricky World of Job Postings

Consider too, that according to a survey done by Clarify Capital, “despite 96% of employers claiming they’re actively trying to fill an open role quickly, 40% of employers don’t expect to fill their active job posts for 2-3 months. In fact, 1 in 10 managers report having job openings posted for over 6 months.” Recruiters often tweak job posts by changing a word or two to keep them from expiring. This is far more time efficient than allowing them to expire and then reposting them.

The number of open jobs may also be inflated because employers sometimes proactively recruit, posting jobs (internally and externally) before a job opening actually exists (and it may not exist for a very long time, if at all). Loretta Barr, a career coach at Korn Ferry, a management consulting firm that specializes in digital, executive search, recruiting process outsourcing and professional search, all but confirmed this. “Sometimes employers might post a job to see if there’s a candidate pool out there,” she said.

Some employers might also post fake jobs for disingenuous reasons, such as to fool their own overworked employees into believing that relief is on the way. Or to give the impression that the company is growing and hiring, when that’s not the case.

There's also the “I’m sorry but we have decided to go with an internal candidate” phenomena that jobseekers too often encounter after they have gotten their hopes up. "Employers may advertise job openings without any intention of hiring external candidates. This is often done to fulfill legal obligations and adhere to equal opportunity policies,” said Peter Cappelli, a professor at the Wharton School of Business and director of Wharton's Center for Human Resources. These jobs shouldn't be included in JOLTS data, but because they are officially posted where external jobseekers can see them, according to JOLTS guidelines, they qualify.

Related Article: Worker Shortage? Tell That to the 'Older' Workers

What Does It Mean if the JOLTS Number Is Wrong?

What does it mean if the JOLTS number is wrong? First and foremost, government and business leaders may be making decisions based on guidelines that were designed for a different world; one where jobs were filled within 30 days and location mattered more than it does today (JOLTS assigns jobs to geographies). A world without well-known workarounds where jobs appear to be open to outsiders when they actually aren’t.

Jobseekers who have been led to believe that good jobs are plentiful and that they can be choosy (1.61 jobs open for each available worker) may find they're having trouble landing interviews. For them, it might be time to forget the statistics and to try a different outlook and approach. It sounds harsh, but it may yield better results — which is what we’re all looking for, right?