There is a well-known trade-off between job vacancy rates and unemployment. When vacancies go up there usually is a lower unemployment rate. This makes simple sense. When more of the labor force is employed or the economy is doing well, there will be greater demand for labor as evidenced by employer having a harder time filling jobs.
The WSJ 4/11/12 provides a good chart of the the change n this trade-off. It seems to have shifted right. There is a higher unemployment for the same vacancy rate. There is two Americas. There is one where workers have skills and firms are looking for educated workers and the other America of longer-term unemployment for those who do not have an education or skills. This is the class divide in America.
We can have tighter labor markets with higher unemployment. This is the problem that has not been fixed. The labor market will not serve as a good estimate of economic activity if this continues.
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