Suddenly, the Unemployable Are Finding Jobs

With a tightening labor market, CEOs are chasing after the same workers they once derided as unemployable.

Mural, Postal Workers sorting mail, Ariel Rios Building, Federal Triangle Washington, D.C. Wikimedia

The post-2008 recession and slow recovery witnessed a spate of reporting and commentary on the so-called “skills gap.” The gist of the argument was that if rates of joblessness remained stubbornly high, it was because workers weren’t good enough for existing jobs: they needed better education, better preparatory training, better skills, and resumes. The bottom line was that workers needed to fix themselves to fit into the economy — not the other way around.

As the economic recovery accelerates, the spuriousness of that argument comes into ever-sharper relief. It turns out corporations were just being picky, taking advantage of a slack labor market and weak demand for their products to discard twenty or a hundred job applications at a time in search of the one perfect employee who — beleaguered by competition and desperate for employment — would work for the wages of an imperfect one.

How do we know that was happening? Because it’s starting to not happen anymore. The labor market is tightening, and companies’ hiring standards are plummeting — showing just how cooked-up those standards were to begin with.

One example is the growing acceptance of workers with criminal records. Companies that previously refused to hire applicants with ties to the carceral system are now desperate for workers. As a result, they’re not just hiring formerly incarcerated people — they’re even hiring currently incarcerated people to work normal steady jobs at full wages. This is an emperor-wears-no-clothes moment: for years, CEOs and hiring managers told reporters and policymakers that they just couldn’t hire people who’d been in prison; that ex-convicts had some defect that made them incapable of performing the work at hand. Now that demand is picking up and hiring is profitable, however, it turns out a criminal record isn’t actually an impediment to, say, wiring tail lights for $14 an hour — that was just one among many arbitrary hiring standards that companies used to artificially inflate eligibility requirements and heighten competition among workers.

Now we have another piece of evidence: drug tests for job applicants are starting to go out of fashion. A spate of companies recently announced they’re abandoning drug tests. Meanwhile, a Colorado business group found that the share of companies who drug test declined from 77 percent to 66 percent in just a single year. James Reidy, a lawyer who specializes in employers’ human-resources policies, put it plainly in an interview with Bloomberg. “We assume that a certain level of employees are going to be partaking on the weekends,” he said. “We don’t care. We’re going to exclude a whole group of people, and we desperately need workers.”

The trend is vindicating to left-wing economists, who for years have been arguing that the supply-side “skills gap” explanation for unemployment is bunk, that American workers are perfectly hirable, that unemployment is not workers’ fault, and that companies had been inflating their applicant standards because of a weak economy, not the other way around.

Throughout the Great Recession and slow recovery, CEOs made a big show of scratching their heads and asking where the qualified employees were. But it turns out their definition of “qualified” is flexible. They could have employed workers with criminal records and recreational drug-use habits all along — as well as those with little previous experience or without a college degree. Now we know corporations were bluffing, because we’re watching them drop the act in real time.