Job Placement Agencies and the Low-Skill Labor Market

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Abstract

This brief uses data from the 2007 Survey of Employers in the Low-Skill Labor Market to describe the role job placement agencies play in helping employers fill noncollege jobs.

Introduction

Workers with limited skills and experience can have a hard time finding jobs, especially in a soft economy. And with limited knowledge about the range of jobs available to them, less-skilled workers may end up taking jobs that they cannot keep because poor pay, benefits, and prospects combined with workplace inflexibility may make it hard to balance the competing demands of work and family. Job placement agencies can play an important role in matching workers and employers, especially less-skilled workers. These organizations include private-sector recruiting firms, community nonprofits, and government employment agencies. Their knowledge of the job market and relationships with employers can help workers find a better job faster than they would on their own. For employers, placement agencies can reduce hiring costs by helping them quickly locate the best person for their job opening.

In this brief, we describe the role placement agencies play in helping employers fill noncollege jobs (those that do not require a college degree). We report on how frequently employers are contacted by agencies and how often they use agencies to fill noncollege jobs. We also discuss the types of jobs most commonly filled using placement agencies and employers’ views on their experiences with these organizations. We use data from the 2007 Survey of Employers in the Low-Skill Labor Market—a national survey of employers that have recently filled noncollege jobs. (See box for more information about the survey.)

Job placement agencies work with a wide range of workers. Because we want to focus on agencies that are helping lessskilled workers, we hone in on employers that have been contacted by public or private agencies trying to place welfare recipients. (Welfare recipients are a subset of all less-skilled workers.) Although this approach necessarily understates total contacts by agencies trying to place less-skilled workers, it allows us to focus on an important subset of less-skilled workers.

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