How Aware Is the Public of Labor Market Conditions?, by Marianna Kudlyak and Brandon Miskanic, Economic Letter, FRB San Francisco, Sept 2024, 2024-25. Download data
Synopsis: How do public perceptions about the aggregate labor market line up with measures of the labor market strength? We construct a labor market perceptions (LMP) index from the Conference Board data using two survey questions that report individuals’ perceptions surrounding current employment conditions—the share of consumers that say jobs are plentiful and the share of consumers that say jobs hard to get. We find that the public perceptions align well with the measures of the aggregate labor market conditions:
1. The LMP index correlates highly with the aggregate unemployment rate except for a year during the pandemic, when people perceived the labor market as being much healthier than the high unemployment rate implied. But this was also the period of a high number of temporary laid-off workers who typically do not go through a time-consuming search-and-matching process to find work as the rest of the unemployed do. So, total unemployment signaled a weaker labor market than it was.
2. The jobless unemployment rate—unemployment for reasons other than temporary layoffs—better captures labor market tightness.
3. We find that LMP index lines up well with the jobless unemployment rate as a measure of overall labor market conditions.
Job Vacancies and Firms’ Labor Market Perceptions, by Marianna Kudlyak and Brandon Miskanic, Economic Letter, FRB San Francisco, Oct 2024, 2024-26. Download data
Synopsis: During the post-pandemic period, the vacancy-unemployment ratio was at historically high levels --- Did the surge in the vacancy- unemployment ratio reflect a surge in demand for labor as opposed to measurement or other issues? Using data from the National Federation of Independent Business on firms’ perceptions of the labor market, we find that during that time firms perceived the labor market as being even tighter relative to historical norms. As of June 2024, both firms’ perceptions and measures of labor market tightness had returned to their 2019 levels.
Background paper:
Consumer and Firm Perceptions of the Aggregate Labor Market Conditions, by Marianna Kudlyak and Brandon Miskanic, FRB San Francisco WP No. 24-26. First version: Aug 2024. Download pdf, WP FRB San Francisco, WP Hoover Institution