Mismatch in Online Job Search

February 2020

Tara M. Sinclair and Martha E. Gimbel

IIEP working paper 2020-1

Abstract: Labor market mismatch is an important measure of the health of the economy but is notoriously hard to measure since it requires information on both employer needs and job seeker characteristics. In this paper we use data from a large online job search website which has detailed information on both sides of the labor market. Mismatch is measured as the dissimilarity between the distribution of job seekers across a set of predefined categories and the distribution of job vacancies across the same categories. We produce time series measures of mismatch for the US and a set of English-speaking countries from January of 2014 through December of 2019. We find that title-level mismatch is substantial, with about 33% of the labor force needing to change job titles for the US to have zero mismatch in 2019, but that it declined from 40% in 2014 as the labor market has tightened. Furthermore, over the same time period, the mix of job opportunities has shifted substantially, but in a way that has made the overall distribution of jobs more similar to the distribution of job seekers. We interpret this finding as evidence that mismatch between job seekers and employers eased due to jobs coming back in the slow recovery after the Great Recession.

JEL Codes: E24, J11, J21, J24, J40, J62

Keywords: Job search, vacancies, employment, unemployment

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