What the Job Market is Like
by Richard in24 Jul 2025
This material was presented in a Lunch & Learn session of the New Zealand Statistical Association on 23 July 2025.
Introduction
I want to discuss what the job market is like, both from the point of view of candidates and from the point of view of hiring managers. Those who haven’t searched for a job for a while might be surprised to learn what the job search is like nowadays. Those who are currently searching for a job might like to know that they are not alone, but also to understand why companies treat candidates the way they do. Why do they ghost you? Why do they make you do so many interview rounds? Hopefully this talk will give you some of the answers.
What we’re going to cover is:
- What are candidates facing?
- Why?
- Is anyone doing anything about it?
- Are there even any statistics in this talk? (The talk covers the job market in general, but I will mention a connection with statistics at the end!)
Matching Frictions
The diagram below shows a simplified view of the labour market. Employed people are matched one-to-one with jobs. There is also a group of unemployed people who are trying to find a job, and unfilled jobs which are trying to match with unemployed people. Things that make this process of matching people and jobs more difficult are called matching frictions, and there are a lot of them!
(By the way, it’s deliberate that the Unemployed People box is bigger than the Unfilled Jobs box in the picture, but that’s a story for another day!)
I went to a conference on labour market economics recently, and I noticed that nobody was talking about these matching frictions. Economists aren’t interested in the rise of ghost jobs or the problems with Applicant Tracking Systems. They are more interested in things like theoretical models of monopsony. However, when I spoke to the economists in person, especially if they had recently been through a job application process, they were often very willing to admit that these frictions exist.
Recruitment Funnel
HR teams understand the process of recruitment as a funnel. It starts with a person finding out about a job opening, putting in an application, going through pre-screening, getting an interview, and getting hired. At each stage, people drop out of the process, so it makes sense to view the funnel becoming narrower towards the base. What I want to talk about are all the things that mess up this funnel, making it more difficult for candidates to pass through.
Let’s dive in!
1. Ghost Jobs
A ghost job is a job which is advertised but doesn’t exist. Is it legal to advertise a job which doesn’t exist? Yes! (More on that later.)
There are lots of articles online about ghost jobs. Here’s one from fortune.com in 2024 and here’s one from the Stackoverflow blog.
Why?
There are a few reasons why people might advertise ghost jobs.
Probably the most obvious one is that many jurisdictions force jobs to be advertised. An example in New Zealand is the Public Service Act 2020. If you create a job for your nephew, you have to advertise it, even if you have no intention of hiring anybody else. I’ve been on both sides of this. I’ve applied for ghost jobs in the past, but I’ve also had a job created for me to which I then applied. Presumably other people took the time to write a CV and cover letter, but had no chance of getting the job. Nevertheless, the job still had to be advertised because the rules said so.
A second reason why a company might post a ghost job is to fulfil a KPI. For example, it might be desirable to have a high rate of rejected applicants. This is something which US universities and colleges like to boast about. It sounded very strange to me when I first heard about it, but the idea is to make the college look more exclusive. A similar measure is sometimes used to evaluate HR teams. If you want a high reject rate, what better than to advertise a job that doesn’t exist? Then the reject rate will be 100%!
Another nefarious reason for advertising ghost jobs is to intimidate current employees, for example by posting a job with a lowball salary range, so that your employees don’t engage in wage bargaining. And it gets even worse. Some people think that companies post ghost jobs in order to make it look like they are growing, purely to manipulate their stock price. (Of course, this last reason only applies to publically-traded companies.)
2. Applicant Tracking Systems
Let’s suppose you have applied for a job and you have got past the first hurdle; the job does in fact exist. Next, you will probably be asked to create an account with an Applicant Tracking System (ATS) like Workday or Lever. You may already have an account from a previous application, but you have to create a new one anyway. Then the ATS scans your CV and gets everything wrong, so you have to type in all the information by hand.
Why?
Why do they make you do this? From the HR point of view, the fact that the ATS is difficult to use is a feature rather than a bug. Is this because HR hates you? No! It’s simply because the volume of applicants is too high. It’s easier than ever to apply for a job and you can apply from anywhere in the world. According to Seek, one of the online job platforms in New Zealand, applications rose by 32% from 2023-34.
HR teams are facing a fire hose of applicants, many with perfectly-tailored CVs. Anything which reduces the volume of applicants is helpful. So for these companies, it’s actually helpful that the ATS forces you to retype your entire CV. Some people will inevitably give up, and that’s fewer CVs that HR has to screen. (From an economic point of view, think of it as increasing the cost of applying for the job. The cost is expressed in terms of time rather than money, but it’s still a cost.)
The ATS also enables HR to implement knock-out factors. For example, if you’re in the wrong country you can be automatically disqualified. Of course, this also opens up the possibility of discrimination by age, gender, race, and any number of other charactistics. Does this happen? Almost certainly. More on that below.
3. One-way Interviews
Suppose you get through the Applicant Tracking System and are granted an interview. Can you expect a face-to-face chat with the hiring manager? Not anymore!
Nowadays, more and more companies are using platforms like Hirevue to schedule asynchronous or one-way interviews. These aren’t actually interviews at all. Instead, you simply record a video of yourself answering questions and send it off, rather like the process to apply to be on a reality TV show. The hiring manager might watch it later, or it might be screened by AI.
Why?
One reason for the increasing popularity of asynchronous interviews is the rise in working from home (also known as teleworking). In Australia and New Zealand, 41% of employees work from home. For teleworkers, videos may be a more natural means of communicating.
Another reason is the sheer volume of applicants. It may be impossible for a hiring manager to schedule calls with every applicant, whereas they can view pre-recorded videos whenever they want. But it’s not even guaranteed that your video will ever be seen. Just like in the ATS, asynchronous interviews can be screened by AI, and you can be knocked out on any number of factors, from the number of times you say “um” to your skin colour. Of course, companies say that they don’t do this, but we have no way of knowing.
4. Endless Interview Rounds
Congratulations! You got an interview with a real person! And then another! They must like you! And then another! And another! And…
Not every company is up-front about their hiring process. Sometimes you find yourself being invited to a seemingly endless stream of interview rounds with more and more hiring managers. One unlucky candidate in the US was invited to 29 interview rounds and then ghosted. More seasoned people might choose to exit the process after a while, but those who are early in their career or who are desperate for work are likely to go along with it.
Why?
Why do some companies draw out the interview process endlessly? The main reason seems to be fear of hiring the wrong person and being blamed for it. The more people you can involve in the process, the less the blame will fall on any one person if it turns out that you made a mishire. In a well-run company, someone would step up and take responsibility for a hiring decision. But not all companies are well-run.
Are there other reasons to draw out the hiring process? Yes. Plenty of jobseekers will tell you anecdotes about having been asked to spend hours creating a new logo or an ad campaign as part of a job interview. After failing to get the job, they see the company using the exact same campaign in their marketing materials. Basically, job seekers are being used as free labour. How common is this? I’ve no idea, but one member of the audience at the talk described a similar experience.
By the way, I did a little bit of modelling of the hiring process and found out that, as a general rule of thumb, you shouldn’t agree to more than five interviews. After that, your chances of getting the job dwindle with each extra interview. And even five seems like too many…
5. Ghosting
Ghosting is when a prospective employer breaks off all contact with a candidate after one or more interviews. If you just sent in a CV and never heard back, then I wouldn’t count that as ghosting. But if the company took the time to interview you and said they would get back to you and then ignored all your subsequent attempts to contact them, that’s ghosting.
How common is ghosting? In a 2024 survey by the Globe & Mail (in Canada) a whopping 40% of candidates reported being ghosted after the second or third interview round. Ken Gallinger of the Toronto Star did not mince words when he said that ghosting is:
yet another sign that our society has passed the last exit on the road to hell.
Why?
There are a few reasons why companies ghost candidates. The most obvious one is to keep the second- or third-best candidates on the hook in case negotiations fall through with the preferred candidate. But it’s not really plausible that this exact scenario happens a lot.
Some recruiters claim that their ATS is literally not capable of sending individual emails to rejected candidates and so they don’t send out emails at all. I find this hard to believe, but it might be true of some particularly poor-quality applicant tracking software.
But my favourite explanation for the rise of ghosting is much more interesting. We all know that comapnies in the US are worried about possible litigation. The Equal Employment Opportunities (EEO) legislation can be a minefield. But some sources claim that there is a statute of limitations for EEO filings in certain states. For example, if you want to make a complaint that you were discriminated against during the hiring process, the complaint must be made within, say, 30 days of last contact with the company. It follows that companies can reduce their chances of being sued if they make sure that rejected candidates don’t know when their date of last contact was! Hence, ghosting! And why did it catch on worldwide if the EEO explanation only applies to America? Well, simply because everybody copies the Americans! Cargo cult behaviour, if you will.
6. Non-competes
Congratulations! You got the job! Now you just need to sign the contract. But what’s this? A clause which says that, if you leave the job, even if you get laid off, you’re not allowed to work in the same industry for the next 18 months? So what are you supposed to do, starve? Apparently yes!
Non-compete clauses are included in job contracts to prevent employees from taking their knowledge to rival companies. They are a harsher than intellectual property clauses and, especially in this age of endless layoffs, they are a bit of a nuisance. They are particularly common in the startup world.
Why?
Obviously, companies include non-compete clauses because they are afraid of their employees finding work with a competitor. But the clauses are deeply unfair to the employees. Imagine a clause that says you’re not allowed to work in statistics! What are you supposed to do instead? You’re not allowed to use your skills and experience? As if finding a job wasn’t hard enough already!
In New Zealand, these clauses come under “Restraint of Trade” and can be litigated by Te Ratonga Ahumana Taimahi / Employment Relations Authority (ERA) which is the first place to seek advice if you find yourself on the wrong end of one of them.
Is anyone doing anything?
The evidence, such as it is, suggests that the situation is dire, both for job candidates and hiring managers. So is anyone doing anything about it?
Yes, someone is. Namely, the Canadian province of Ontario, which will bring Bill 190 into law in 2026. Bill 190 bans both ghost jobs and (surprisingly) ghosting (see Sections 8.5 and 8.6 of the bill).
Someone is taking on Applicant Tracking Systems too. Derek Mobley, an American man, sued Workday in 2023 on the grounds that he was being discriminated against due to age. It was recently announced that his lawsuit has moved forward, which ultimately might lead to us finding out whether Applicant Tracking platforms really do discriminate against people. And this is where statistics come in! According to Mobley:
There’s a standard bell curve in statistics. It didn’t make sense that my failure rate was 100%. It dawned on me that this must be some kind of server reviewing these applications and turning me down. (Source)
Can we do anything?
One of the participants asked the question: is there anything we can do? For hiring managers, it’s hard to handle the deluge of applicants. For jobseekers, it’s hard to stand out in a flood of applications. What to do?
I don’t have any answers. Dysfunctional markets ought to be regulated, which is what Ontario’s Bill 190 is attempting to do. But there is no law (yet) against posting jobs which don’t exist, and there’s no law against lying on your CV and making pointless work for hiring managers. Perhaps in the future we’ll need some sort of centralised clearing house where open jobs can be matched with applicants?
In the meantime, I expect that the job market is going to get tighter in the next few years, and the frictions are going to get worse. But I’ve been wrong before, so who knows. I do think that statisticians, especially in government, have a role to play in fixing the job market. The first step is to diagnose the problem. We need to get serious about thinking about these issues and start gathering data instead of anecdotes.