The Inside Job

With 14.9 million Americans out of work and looking for jobs in August, economists are less than optimistic about the prospects of getting the unemployment rate back to pre-recessionary levels in a reasonable amount of time. But some workers may be able to find a home back where they last worked, according to a couple of new reports.

[See the good and bad news about job openings.]

It turns out that 40 percent of employers expect they will hire back some of the workers they laid off in the recession, according to a new survey by OI Partners. The employers surveyed said they would be rehiring workers as full-time employees, consultants or freelancers. About half of financial companies surveyed said they planned to rehire workers, and 47 percent of manufacturing companies said the same.

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Last month, 19 of the nation's metro areas had unemployment rates that reached 15 percent or higher. The national average was 9.4 percent. Of those 19 areas, 8 were in California and 5 were in Michigan. Cities with the highest unemployment rates were El Centro, Calif., at 30.2 percent, and Yuma, Ariz., at 26.2 percent. "In addition to being affected by the economic downturn, these two adjacent areas are highly agricultural and experience extreme weather during summer months," the Labor Department reports.

One interesting thing to look at is how labor force growth, or decline, may contribute to the unemployment rates in these cities.

Between July 2008 and July 2009, the total U.S. civilian labor force actually fell by a tiny margin—about 2,000 workers. Labor force participation generally falls in very bad job markets, as people who are not in need of work, or become discouraged, stop looking for it.

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Between July 2008 and June 2009, employers made a stunning 51.8 million hires, the Labor Department reports today. Of course, there were 57.1 million separations (via layoffs, quitting, and so forth) over the same period.

[See 10 cities with the most job postings per capita.]

In its monthly JOLTS report--Job Openings and Labor Turnover Summary--the Labor Department reports there were 2.6 million job openings on the last business day of June. That's a preliminary figure, but it's very slightly higher than both April and May. Job openings were falling through April, so this may indicate that they bottomed out that month and we'll now continue to see the volume of openings grow, just as the pace of job cutting is slowing.

The volume of openings are, however, a particularly ugly reflection of the current state of the job market. They continue to hover around this 2.5 million-to-2.6 million level, which is the lowest since the data series began in 2000. Of course, at no time since then were job openings as crucial as they are now, with 14.5 million unemployed workers looking for work. There were nearly 6 active job seekers for every opening in June. Just three years ago, there were 1.5 active job seekers for every opening.

[See why job seekers are now relocating]

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I recently wrote about a House bill that would prohibit private non-financial companies from running credit checks on potential hires. Many people are unaware of the practice until they're interviewing for a job and asked to sign a form permitting the company to check out their credit history.

Some consumer rights groups believe this practice--once used in a more restricted fashion--now extends the cycle of financial difficulty, by preventing credit-challenged workers from gaining the paycheck that could help them find a more solid financial footing.

In the meantime, however, it's something for job seekers to consider in their searches. "The traditional conventional wisdom is: establish your network, get your resume in order. I'd add the third thing, in today's world, is know what your financial information says," says Bruce Cornelius, chief marketing officer of CreditReport.com, a company that monitors consumers' credit reports for a monthly fee.

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