Understanding Labor Mobility

Companies that hire in a tight labor market need to get creative when they attract candidates. That means looking at different factors that influence employment, such as labor mobility. 

Labor Mobility Explained

Labor mobility is one of the key drivers of recruiting, retentions and turnover. It refers to the ability and desire of individual workers to move from one location to another or from one occupation to another. Employers are dealing with labor mobility whenever they consider site selection, relocation hires, and flight risk. Wondering which talent pools you should tap next? You better factor in labor mobility. Worried about flight risk, or whether your jobs are in locations that your target candidates will find attractive? That’s a question of labor mobility, too.

Labor mobility is at play with many workplace-related trends in the news. For instance, there has been much debate about the generational shift of younger workers to urban areas, and how that might change the pattern of young families moving to the suburbs. The rich cultural life in high-profile large cities like New York and San Francisco are major attractions, but life-changing events, such as a family member’s illness or a partner taking a new job, also influence whether a worker will decide to move locations or switch careers.

Our data shows that on average it is significantly harder to get a job in a city from out of town. The cities where it is hardest for out-of-town candidates to find jobs includes some of the most prominent and dynamic metropolitan areas, including Boston. New York City, Washington, D.C., and Atlanta.

Why It’s Hard for Candidates in These Cities

There are several shared features of the cities that may make it difficult for workers to find employment, but the two that stand out are city size and the student population. Large cities tend to have a higher cost of living and thus higher relocation costs than other parts of the country. And since these cities are so populous — often with a strong bench of local universities — they already have rich local talent pools. 

Indeed, the impact of local schools is substantial, since the largest volume of open jobs and job applicants are typically entry level. Consider New York City, which is home to universities and colleges such as Columbia, NYU, Fordham, Pace, and the CUNY and SUNY school systems, just to name a few. Students from these universities have four years to network and build relationships with businesses through internships, apprenticeships, and co-op work, all which gives them a leg up on out-of-town candidates.

Our data points to Dayton, Ohio, New Haven, Connecticut, Springfield, Massachusetts, and Des Moines (pictured) as the cities that are most promising for out-of-town applicants, in terms of the ratio between such applicants and available jobs. These cities have a lower profile than others, but also feature lower costs of living and less diversified talent pools.

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The Cities at Risk

Durham and Raleigh in North Carolina, Providence, Rhode Island, and the Orlando area in Florida see the largest proportion of their job seekers applying to other cities. These cities have large student populations but smaller and less diversified industrial bases than a New York or Los Angeles. The cities with the lowest level of outbound applications compared to local job seekers include Las Vegas, Memphis, Louisville, and Indianapolis.

The Benefit of Considering Out-of-town Applicants

In a competitive job market, employers need to take talent where they can find it. Despite the challenges, there are many reasons to hire out-of-town applicants, yet the evidence suggests that many employers are reluctant to do so. It is harder for employers to find and evaluate out-of-town applicants because their networks don’t overlap as much as with locals. They are very likely overlooking some not-so-well-connected people who would be star performers. Those employers who can find those gems efficiently stand to gain.

Hiring out-of-town candidates is certainly a challenge, but companies looking to do so have a few tools at their disposal. Over the long term, they can advocate for affordable housing policies that make it easier for out-of-towners to visit or transplant themselves. In the short-term, they need to find or create reliable gatekeepers who can help them filter through all those unfamiliar candidates. In other words, they need to build talent pipelines specifically for out-of-towners. Reaching out to community colleges, universities, and other skill-building institutions with well-matched programs is a good place to start, but employers don’t need to settle for the existing offerings. They could also invest in sponsoring linkage programs to funnel promising students directly to the employer. 

There are some interesting debates about how prevalent job-hopping is among younger workers, but one thing we know is that many of them are carrying significant student debt loads, so programs that promise debt relief will be attractive. Hosting events can also be effective: hackathons are great because they set a stronger filter than a career fair, but there is plenty of scope for recruiters to get creative in designing other kinds of networking-and-filtering events.

As iCIMS’ chief economist, Josh Wright leads a team of data scientists in analyzing U.S. labor market trends. With nearly 15 years of experience, Wright previously served as a U.S. economist with Bloomberg L.P., and was a staff researcher at the Federal Reserve. Wright holds a bachelor’s degree from Yale University and a master’s degree in public policy from Harvard University. His publications span academic and policy journals, popular blogs, and major media outlets.

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