October 1, 2022

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Are ‘fake’ job ads inflating America’s employment data?

2 min read

Taylor Goucher is urgently looking to hire accountants and customer support technicians to work for Connext Global Solutions, the offshoring consultancy where he leads client services.

But those are not the only job listings the company has posted. They also have five additional listings, for engineers and a vice-president, that he plans to leave up indefinitely.

“For really tough openings, the right people only come up so often, so we have to leave them open and just sort of wait and hope that at some point, a good candidate is going to come through,” said Goucher, who said he adopted the strategy 18 months ago after working to fill one role for nine months to no avail.

Some economists suspect that Goucher may be among a growing number of employers posting so-called purple squirrel vacancies to be left up indefinitely in the hope of finding the kind of perfect candidate that is as rare as woodland creatures with pastel fur. If true, it could help explain why job openings figures remain elevated.

“These are purple squirrel vacancies,” Christopher Waller, a Federal Reserve governor, told reporters after a speech to the Institute for Monetary and Financial Stability in Frankfurt. “They’re not real.”

To Waller, such vacancies strengthen the US central bank’s case for tightening financial conditions. If long-term job listings are inflating the job openings figures, labour might not be as in demand as it seems. That could make it possible to reduce the number of vacancies advertised by companies without significantly altering the unemployment rate. The Fed is raising rates to tamp down on inflation but fears persist that steep increases could paralyse the jobs market or trigger a recession.

US employers added 390,000 jobs in May, the labour department reported on Friday.

The bulk of the 11.4mn job openings reported in April are not waiting for “purple squirrels”. A Goldman Sachs analysis found that two-thirds of current listings were posted in…



2022-06-04 13:00:45

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