This Is Why Low Unemployment Is Good for You
You probably already know that our economic climate is in a very interesting spot.
When it comes to finding a job, many say that it has never been easier.
But you may feel that is a lie since you have been looking for a job for the past few months and still have zero job offers.
- You may have some questions:
- Where is the economic climate?
- Where are these jobs hiding?
- How do I find these positions?
And most of all…
How do I take advantage of this said, ‘”Great Economic Climate”?
All of these questions will be answered throughout this blog post.
Table of Contents:
Overview: What is unemployment?
The Climate: What is different today than ever before?
The Opportunity: Why is this the time to say “YES”?
Before we start things off, I want to talk about exactly what “unemployment” is defined as.
“Official” unemployment refers to the number of civilian workers who are actively looking for work and not currently receiving wages.
What makes the unemployment rate interesting is that it doesn’t include individuals that would like to work but have stopped looking because they have become discouraged.
This means that the “true” unemployment is actually higher than the “official” rate.
Within unemployment, there are several subtypes:
- Frictional Unemployment is caused by the difficulty in matching qualified job seekers to jobs. A great example of this is college graduates that are looking for employment. Although frictional unemployment is not desired, it is impossible to avoid and therefore not looked down upon by economists
- Cyclical Unemployment is unemployment that results from the normal business cycle. An example of this is ski resorts. Resorts often look for seasonal work and then downsize during the summers when less work is needed.
- Structural Unemployment occurs when job seekers are not qualified or trained adequately for the jobs that are available and needed.
These three types of unemployment collectively make up the “official” unemployment rate.
Now that we have given an overview of unemployment, let’s get into the sick of things…
The Climate: What is different today than ever before?
Over the past 20 years, the United States economy has been through a world wind.
In the early 2000’s we had the dot-com era.
If you hadn’t heard, there was a bit of an internet bubble.
“A Bubble is when ‘surges in asset prices to levels significantly above the fundamental value of that asset.”
Bubbles can be hard to detect because, at that point in time, the asset value does not seem out of the question.
What happened in the early 2000’s was that many internet companies were raising money and claiming that they were a very valuable company.
But when people started noticing that these companies were not doing well, all Hell broke loose. In a span of a few months, many companies that were valued at hundreds of millions of dollars were completely broke.
And obviously, when companies go bankrupt they have to let go of all their employees.
The graph below shows the unemployment rate leading up to the dot-com bubble. Which took place between 2001- 2004.
As you can see, the unemployment rate went from around 4% to its peak at 6.5%. That was over the span of 3 years.
It took almost the same amount to recover back down to a 4.5% unemployment.
This recovered unemployment rate did not last long.
As many of you know, we most recently had a housing bubble in 2008, which resulted in one of the worst economic downturns since the great depression.
Although the underlying issue was a housing bubble, the downturn affected almost all regions and industries in the united states.
As you can see above, this recession resulted in an unemployment rate of almost 10%.
This recession hit everyone from small towns in Alabama to San Fransico.
Both entry level and senior level employees lost their job This reminded many that just because they have a job doesn’t mean that they are invincible.
The great recession slowly started to take a step towards normalcy, but not for a few years.
Although many were just looking for the unemployment rate to return to normalcy, it did a little better. It has been creeping lower and lower.
Currently, the unemployment rate is at some of the lowest levels that we have seen in almost 50 years!
The economic climate is great for job seekers because there are more positions open than there are people to fill them.
Currently, there are over 6.5 Million job openings around the country.
But with such a low unemployment rate, these job openings are becoming harder and harder for companies to find and attract top-quality talent.
Not only are they struggling to find talent, they are also struggling to keep them.
Below is a comparison of quit and turnover rates. As you can see, since 2010, more and more people have moved on from their current jobs.
With so many employees jumping ship, companies are trying to get more creative.
Companies are using these tactics to gain a competitive edge:
One of the most common ways to stay more competitive is to offer higher salaries to your employees.
This is especially true with today’s climate. Many employees will, and have, jumped ship for a little pay raise.
Many companies keep their employees happy by making sure they are compensated in the top 5% of their industry.
Better Benefits, Amenities, and Perks
Realistically, many companies don’t have the cash on hand to pay their employees more to stay competitive.
In order to still keep their competitive edge companies are getting more creative with their benefits, amenities, and perks.
Having the basics (medical, dental, and vision) is not as competitive as it used to be. Employees care about different things in the workplace nowadays than they used to.
For example, companies are moving from the suburbs to downtown areas to attract younger talent. Some companies are even allowing more freedom for employees to work when and where they want.
Here are some of the more obscure and creative benefits that I have seen:
- Pet-friendly offices
- Personal wellness coaches
- Free gym memberships
- Student Loan reimbursements
- Freedom & even money to travel
Those are just a few creative ways that companies are trying to attract and retain the top talent within their organization.
Advertising their Culture
One of the most competitive ways companies can move to the top of the list is by making themselves an awesome company to work for. There is also a great upside of making a top-notch work culture…
…it doesn’t cost a lot of money and can’t be copied!
Your culture is your culture. Other companies can offer the same benefit and pay, but they can’t copy your culture.
“Culture is the best competive advantage in today’s environment.”
Younger employees are looking for more things in a company.
Yes…pay and benefits still matter, but company culture and fit have become increasingly important in the job search process today.
Almost everyone want’s to be a part of something bigger than themselves.
Many job seekers will accept a little less pay in order to work for an awesome company culture.
For example, think about why you think Google is an awesome place to work?
Yes…they offer great pay and benefits, but what makes them unique is their culture.
They foster an environment of inclusion, entrepreneurship, and creativity. Like, who wouldn’t want to work in that type of culture?!?
So, how do I take Advantage of this Economic Climate?!?
So, by now you should understand what is meant by the term “economic climate”.
It is a great time for you to look for a job because almost all the chips are in your corner.
Here are some ways that you can take full advantage of the unemployment:
Apply for jobs that you are not 100% qualified for
With employers being strapped for talent, they are now being more lenient when it comes to qualifications on job posts.
No, this does not mean that you can now apply for a VP level out of college.
But you now may have a chance to get a position that you originally thought you were not qualified for.
Keep in mind, hiring managers will still be picky about some qualifications.
For example, let’s say you just graduated college and have had two internships (three months each) doing social media marketing.
Don’t be afraid to apply for jobs that require past experience of 2-4 years.
Prior experience, if relatively close, is one of the things that companies will be a little bit more lenient on these days. Although, make sure it is within reason. Shoot for about 50-60% qualified in total.
In comparison, if you were a biology major with no experience then this job is out of the question.
In summary, don’t be afraid to apply for some jobs that you believe you may be unqualified for.
Emphasize your soft skills
Emphasizing your soft skills when applying for positions that you are not 100% qualified for is going to be very important.
When companies are hiring employees that are not 100% qualified, they are taking on a pretty big risk.
To mitigate and convince them that the risk is worth it, you should be highlighting your soft skills more.
These are some of the basic soft skills:
- Critical Thinking
- Work Ethic
But the most important one to highlight is…
“Learning agility is the ability and willingness to learn from experience, and then apply that learning to perform successfully under new situations.”
The big part of learning agility is learning through experience.
A company is often hesitant to hire a candidate that has very little experience because it requires a large amount of training on their side.
By emphasizing learning agility, you are emphasizing that you learn not only by training but through experiences.
This allows companies to be more comfortable throwing you into new projects and situations, knowing that you will be able to learn and apply that learning to future projects.
Hit the job search hard, especially for women and minorities
This may seem weird, but low unemployment is an amazing thing for minorities and women.
As we have talked about, companies are having a hard time hiring and they are often more lenient on many qualifications.
Sadly, in our society, we have individuals who use racial bias in the recruiting and hiring process.
Luckily, with the competition for talent, many of these same people will not put as much weight on race or gender as they may have in the past.
They need someone now, and they only care about who is the best fit.
Therefore, this is a great time for women and minorities to finally be seen in the same light.
Stereotypes and biases become less apparent during competition.
So, to those women and minorities…
…go out there and get after it!
Don’t be afraid to ask for more
Congrats, you got a job offer!
So, you have the offer letter in hand and it isn’t what you expected.
You thought you would be paid a little more than what is listed. Don’t worry, you still have a chance to get that salary up.
With it being so hard for companies to find qualified candidates, they are will to go the extra mile to keep them.
And since they decided that you were qualified and a great fit for the organization, they want you.
That means that the ball is in your court when it comes to negotiating.
Start out by finding out what you’re worth in terms of salary.
So, now you know what the market will pay you.
But here comes the hard part of negotiating that desired salary.
Always remember that negotiating is all about convincing your future employer that the things you produce will be worth more than the salary they offered.
“Salary is not the only thing that you can negotiate.”
Try getting creative and negotiating for flexible work hours or the ability to work from home. For a company strapped for money, that is a much better option than an increased salary.
With unemployment so low and the competition for talent at an all-time high, the ball is in your court.
Keep that in mind and remember that…