not hiring the unemployed

Posted: April 25, 2011
By: Clay Cerny

Huffington Post reports thatNew Jersey has passed a law that makes it illegal for employers to post ads that prohibit applications from the unemployed.  Employers can be fined up to 5,000 for this offensive.  Who signed the law?  Scott Walker’s good buddy, Chris Christie (Isn’t he against such “nanny state” laws?).

This law might make some job seekers feel better, but it really doesn’t make much of a difference in the real world.  Employers can still screen out employees who are not currently employed if they choose.  Moreover, as I’ve written in the past, this controversy makes no sense.  If an employer can choose between equally qualified candidates who are employed and unemployed, they will choose the unemployed.  Why?  Because unemployed workers will usually take a lower starting wage.

Posted: November 19, 2010
By: Clay Cerny

Some alleged experts give really bad advice.  Over the past week or so, I’ve heard from clients and seen in the media a much repeated story about companies not hiring people who are not currently employed.  Will some companies follow this hiring strategy?  Of course.  Will most employers follow it?  I don’t think so.  Let me explain why.

Put yourself in the employer’s position.  You can hire two equally talented candidates.  One is employed; the other is not.  Which candidate will be able to ask for a higher salary?  In this light, the unemployed candidate has the advantage because she will work at a lower wage.

There is a second reason this story fails the reality test.  Hiring is cyclical.  When demand for workers rises, employers who now say they only hire people with jobs will have to hire the unemployed.  They will have no choice – and no other candidates.  

The Internet and 24/7 media cycle give small stories too much power.  Look behind the experts’ words and ask if they make sense.  Test the claim.  Does it make sense?  In this case, the claim doesn’t make sense. Don’t believe all of the negative and scary stories that you hear.  Ask questions – test the experts.