LMI Will Never Be Your “Magic Number”


by Denise Felder

Job seekers and career advisors alike are looking for the light at the end of this dark recession tunnel. Many use the unemployment rate, job growth rates, salary tends, or other labor market information (LMI) to make career decisions or give advice. These number can give you hope and can confirm your own experiences in the job market. But when the LMI doesn't show you what you want to see, it doesn't mean that all hope is lost.

 

LMI shows a broad picture of what's happening in the labor market at a specific time. Among other things, it measures which types of employers are hiring, what they are paying, and how many people they plan to hire in the future. It can also show the skills and education levels of the people being hired. These statistics can explain why some job seekers are hired and others are not.

 

Only One Piece of the Puzzle

The labor market is only one factor in how or why a person is hired. Just because the numbers are good doesn't mean that employers are hiring this week or that they are looking for someone with your exact skill set.

 

I often speak to job seekers who say they are looking for work in a field with high demand, such as health care, but they are not seeing many job openings. Likewise, I've talked to people who work an area with "bad" LMI, and they've received multiple job offers. Why does this happen?

 

There is a lot of LMI a job seeker could use. One of the most popular numbers is the growth rate. It estimates how many people might be working in an occupation in the future compared to today. However, it does not reflect which employers are hiring now. There are many occupations with higher-than-average growth rates, and currently are not hiring many people. Some green careers fit this category.

 

So why pay attention to growth rates? Growth projections help students and others who are not immediately applying for jobs make training decisions or career changes into occupations that are likely to hire them in the future. Understanding long-term projections gives you time to prepare.

 

The “Current” Job Market

No statistic or LMI will ever show what is happening in the job market "right now." Official reporting always needs a solid sample of data to draw from—and that can only come from analyzing previous activities, like which occupations employers had openings for last month, last quarter, last year, etc.

 

The LMI report that most closely reflects the job market "right now" is the Job Vacancy Survey. The Minnesota Department of Employment and Economic Development (DEED) does this survey of Minnesota employers twice a year. Also, DEED's Occupations in Demand list uses the Job Vacancy Survey and Unemployment Insurance data to show the occupations that are hiring and their pay ranges.

 

To determine which employers might hire in the near future, use DEED's short-term projections. Look at the total openings, which include both future growth of an occupation and replacement hiring of people who have changed jobs or retired.

 

While LMI can't report which employers are hiring immediately, it can help you see what employment trends were like in the recent past and predict where they are likely to be in the near future.

 

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