By Lise Wagnac
Ever wonder what the secret behind getting a job in this market is? Well, after a week and a half of my Labor Economics course I’ve been given a glimpse of the ways in which employers are hiring.
Labor economics is defined as the study of how labor markets work. A firm’s labor supply curve is upward sloping because they are always hiring. A firm’s labor demand curve is downward-sloping because the demand for labor will continuously decrease as supply increases. If a firm is supplied with labor, it no longer has demand. In the economy today, supply greatly outweighs demand, leading to the fierce competition among recent college graduates.
A firm that wants to maximize its profits will only hire those candidates it believes will increase the value of the firm through production. The firm would only hire workers up to the point where wage rates equal the cost of their labor and would never pay more than the value of labor they are receiving. In order to be hired, a prospective employee must ensure that his labor is more valuable than that of the other job candidates. If a firm realizes it can receive more value from one person than the other at the same price, they’ll hire that person.
Firms are essentially looking for someone who can make them more money. A candidate is more valuable at a firm, monetarily speaking, when his specific skill set is in demand.The National Association of Colleges and Employers (NACE) surveyed employers to find out which college majors were in highest demand. The top three majors were business, engineering and computer science. Students graduating with these degrees are more likely to have a multitude of career options and more bargaining leverage once they get a foot in the door.
All of these assumptions are, in theory, correct, but think about what is happening today. Employers often expect applicants to fit a certain set of strictly-defined qualifications. This makes it easier for them to weed out unqualified applicants. Employers feel that the amount of money they spend on recruiting should be well spent.
“Employers are looking for multiple things; first, the list of qualifications they provide, i.e. the ideal candidate; and second, someone responsible who communicates well, is hardworking, self-motivated, and has ability to learn and react quickly,” Professor of Labor Economics, Jonathan Lanning, said. “This is essentially the reason a college degree is so valuable: because although almost nothing you learn in college will apply directly, it teaches you ‘how to learn.’”
Employers have difficulty with liberal arts students because the cost of understanding the types of work they are doing in class is not beneficial on their end. It is cost-effective then to hire from schools like Wharton, and Harvard for business undergraduates who they know have been exposed to certain aspects of the job. The challenge then becomes how a liberal arts student markets himself to a potential employer and demonstrates the value of a liberal arts degree. A great example is liberal arts’ students’ ability to learn quickly, and deconstruct complex subjects. These two skills are very valuable in any industry.
According to Lanning, the qualifications for certain jobs are narrow, but what is most important to employers is the ability to learn quickly and to interact and communicate with diverse groups of people. Companies are looking for someone who is broadly educated, can think critically and globally, and writes effectively. This is what employers are really looking for and if you can showcase these skills–you’re hired!