James B. Huntington, Ph.D.
AJSN

What is the AJSN (American Job Shortage Number)?

Royal Flush Press, the publisher of Work’s New Age:  The End of Full Employment and What It Means to You and Choosing a Lasting Career:  The Job-by-Job Outlook for Work's New Age, has developed a key economic indicator.  The American Job Shortage Number, or AJSN, shows latent demand for jobs in the United States.  The number is taken by conservatively estimating the shares of people in 11 different categories who would work if jobs were readily available. 

What value does the AJSN have now?

The current AJSN, using Bureau of Labor Statistics data released October 6, 2017 is 16.7 million.  Although the unemployment rate has dropped in recent months, the AJSN is broader-based, and answers the question of how many new jobs could be quickly absorbed.   

How is the AJSN calculated?

The Bureau of Labor Statistics releases the official unemployment percentage monthly.  It also offers a variety of other numbers related to employment every year, including the numbers of people with other labor statuses.  Among them are the total count of people working and officially unemployed; people working part-time for economic reasons; those discouraged from looking for work; those not working due to family responsibilities, being in school or training, ill health or disability, or other reasons; people who want to work but did not look for a job in the previous year; those who want to work but cannot now; and those who do not want a job at all.    
 
So how can we assign demand for jobs to these categories? Let’s start with two assumptions. First, I will name percentages based on a very strong labor market along a wide range of fields, one where almost anyone willing to work could find a job within a matter of weeks. The closest comparison in recent decades I know of was Houston in the early 1980s, when so many people moved there from manufacturing-declining Detroit that a newspaper’s lead sentence said the hottest import there weighed only seven pounds and couldn’t be driven: a Houston Sunday newspaper filled with job ads. Second, I will strive for conservatism.
 
Although those in the unemployed category are officially looking for work, some are there only briefly between jobs and some frankly prefer not to work, so I will estimate 90% would obtain employment. The three categories of people with jobs would be unchanged. Discouraged workers in a time of ample jobs would function much as those officially unemployed, so I have also assigned them 90%.
 
Those in the next set of statuses are smaller in number, but are harder to estimate with confidence. Those on the record as wanting to work but have stopped now due to family obligations would mostly continue them, but many would end up with jobs, so I will say 30% would take employment. While continuing school or seeking training is ostensibly a primary goal, many are there for lack of a paying alternative, so I estimate 50% of those would work. People with ill health or disabilities are mostly not able to take a job, but as we can understand from the rising number of disability applications, some would reach the labor force if they knew they could get employment, so I have included 10% as working. In the “other” grouping, I have estimated 30%.
 
In a job-seeker’s market, those who did not search for work in the previous year but say they want jobs and are ready for them now would be similar to those officially unemployed. Since I think a significant number, though, would choose to continue not looking, I will assign 80% of them to finding work. Many of those “not available to work now,” but still officially wanting jobs, would get them—I say about 30%.
 
How many people who are out of the labor force and claim not to want work would end up with it in a robust market?  That is hard to tell. The great majority are fully retired, like or accept their lives as they are, and would not seek employment. However, people make plans, even long-term ones, based on what they consider to be realities. In the current market, many assume they could not get a reasonable job even if they wanted one, so we cannot dispose of the category entirely. With more than a quarter of the population, this is the largest single employment-status grouping, so small changes to the estimate would have a large effect on the number of potential employees. I have estimated that 5% of these people would get jobs if they thought they could, which, though possibly way too low, is unlikely to overstate.
 
We are left with the non-civilian and institutionalized category, of whom some in the armed services but few shut-ins might take jobs elsewhere, so I have assigned them 10%, and American expatriates, many of whom have left because of economic conditions at home, 20%.
 
How will the AJSN be reported?
 
Every month, on or soon after day when the BLS releases their data (usually the first Friday), the new AJSN will be posted on the Work's New Age blog, which is at http://worksnewage.blogspot.com/ .  The historical progress of the AJSN from July 1994 to July 2012, comparing it with unemployment rates and unemployment levels, is available as the September 16th, 2012 post on the same blog, at http://worksnewage.blogspot.com/2012/09/historical-american-job-shortage-number.html .  The AJSN from its August 2012 inception through the end of 2014 is recapped, and compared with other economic indicators, at http://worksnewage.blogspot.com/2015/01/the-ajsn-vs.html .

How can I comment on the AJSN?

 
Comments and suggestions are welcome!  You can post comments on the blog above.  You can also reach the AJSN's originator and keeper, James B. Huntington, at jhuntington@royalflushpress.com, on the Contact page on this website, or at 845-456-0115.