In a May 15 speech on small businesses and the recovery, Federal Reserve chair Janet Yellen made what might seem like an obvious statement: “Overwhelmingly, it is businesses that create the (nation’s) jobs.”
Her point in making it, however, was to emphasize that the role of business in job creation has grown even more important in the wake of the Great Recession. While more than 8 million jobs have been added since 2010, when the turnaround began, public-sector employment has declined.
Indeed, private-sector employment in March topped the previous high, set in January 2008. But with government jobs still declining, a full job recovery has yet to be achieved.
The numbers for the Rochester region also illustrate these dual trends. From December 2010 to the end of 2013, total non-farm employment rebounded to 516,000 from 503,100; by contrast, government jobs fell to 82,000 from 83,700.
No one expects the public sector, at any level, to go on a hiring spree. So the role of businesses in boosting employment will only increase.
Which underscores the importance of understanding another aspect of the job recovery: Private employers could do even more if they had a larger supply of skilled prospects for openings, at a wage they can afford to pay.
As reported in this week’s issue, a new study by Monroe Community College found that some 26,000 positions in the Finger Lakes region are chronically hard to fill. The study, conducted in partnership with the Center for Governmental Research Inc. and the Rochester Business Journal, also pinpointed the area of greatest difficulty: middle-skill jobs, those requiring more than a high school diploma but less than a degree from a four-year college. Fifty percent of survey participants said middle-skill jobs are chronically difficult to fill.
MCC is addressing this gap with training programs. The problem seems multifaceted, though; more than two-thirds of survey respondents said paying up to 20 percent more could result in an adequate supply of applicants—a step they apparently are unable to take because of competitive pressures.
A simple solution would be nice, but clearly ramping up job growth will require effort on many fronts.
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