Mixed message on jobs

A well-watched jobs report was better than expected Wednesday, but the anecdotal news for those looking for work wasn’t so good.

First, let’s look at the ADP report from this Wall Street Journal story:

Private businesses added new employees in February at a faster pace than economists expected, according to a tally of private-sector hiring released Wednesday.

Private-sector jobs in the U.S. increased by 198,000 last month, according to a national employment report calculated by payroll processor Automatic Data Processing Inc. and forecasting firm Moody’s Analytics.

Economists surveyed by Dow Jones Newswires expected ADP to report a smaller gain of 175,000 private jobs. The January job gain was revised up to 215,000 from 192,000 reported a month ago.

The ADP report comes out two days ahead of the Bureau of Labor Statistics’ employment situation report. The BLS report counts private and government payroll slots. The median forecast of economists expects February payrolls increased 160,000. Although the ADP report beats expectations, the increase may not be big enough to cause many economists to change their forecasts significantly.

According to ADP, companies employing between one and 49 workers increased jobs by 77,000 in February. Midsize businesses with payrolls of 50 to 499 workers hired 65,000 new employees. Large firms, businesses with 500 or more employees, added 57,000 positions.

Service-sector jobs increased by 164,000 in February, and factory jobs rose by 9,000.

But the news isn’t all good news for many in the market for employment.  According to a New York Times story, companies are reluctant to fill positions and are calling job candidates back for more rounds of interviews than in previous years.

American employers have a variety of job vacancies, piles of cash and countless well-qualified candidates. But despite a slowly improving economy, many companies remain reluctant to actually hire, stringing job applicants along for weeks or months before they make a decision.

If they ever do.

The number of job openings has increased to levels not seen since the height of the financial crisis, but vacancies are staying unfilled much longer than they used to — an average of 23 business days today compared to a low of 15 in mid-2009, according to a new measure of Labor Department data by the economists Steven J. Davis, Jason Faberman and John Haltiwanger.

Some have attributed the more extended process to a mismatch between the requirements of the 4 million jobs available and the skills held by many of the 12 million unemployed. That’s probably true in a few high-skilled fields, like nursing or biotech, but for a large majority of positions where candidates are plentiful, the bigger problem seems to be a sort of hiring paralysis.

“There’s a fear that the economy is going to go down again, so the message you get from C.F.O.’s is to be careful about hiring someone,” said John Sullivan, a management professor at San Francisco State University who runs a human resources consulting business. “There’s this great fear of making a mistake, of wasting money in a tight economy.”

As a result, employers are bringing in large numbers of candidates for interview after interview after interview. Data from Glassdoor.com, a site that collects information on hiring at different companies, shows that the average duration of the interview process at major companies like Starbucks, General Mills and Southwest Airlines has roughly doubled since 2010.

“After they call you back after the sixth interview, there’s a part of you that wants to say, ‘That’s it, I’m not going back,’ ” said Paul Sullivan, 43, an exasperated but cheerful video editor in Washington. “But then you think, hey, maybe seven is my lucky number. And besides, if I don’t go, they’ll just eliminate me if something else comes up because they’ll think I have an attitude problem.”

The Times story doesn’t do anything to resolve the conflict between the anecdotal reporting and the actual figures released. The story was extremely well reported with a variety of “real people” examples, which every reporter knows can be more than challenging to find. I commend Catherine Rampell for her diligent work, but there should have been some mention of the latest job numbers.

I would like to know why companies seem to be dragging their feet on putting people in jobs, but employment continues to rise. I’m sure there is some explanation and I hope a diligent reporter will follow through on finding it.