Decline of White-Collar Workers Is Making More Room for Others

Knowledge workers in technology, finance and elsewhere in corporate America are used to having the most options and leverage in the labor market. They are still far from facing hard times, but recent data suggest their fortunes have downshifted to lukewarm from white-hot. The main reason they aren’t worse off is that many younger and less experienced workers are coming off the sidelines to take less glamorous and hard-to-fill jobs in industries like education and health care. That’s helping support growth while also easing inflation by taking strain off supply chains — and that should give the Federal Reserve more confidence that it doesn't need to break the economy to bring supply and demand back into balance.

Views on the job market for knowledge workers can depend on what’s being measured. For example, there are still more unfilled jobs for professional and business services workers than there were prior to the pandemic. But as of February, job openings have fallen as much over the past year as they did during the 2008 recession. And real-time job postings data from Indeed.com suggests that the decline in postings in finance and tech has carried over into April. So things may be fine for now, but the trend is ominous, and it’s fair to wonder about how much more conditions will deteriorate over the next several months.