The Bureau of Labor Statistics (BLS) reported that US job openings rose sharply (by 731,000) to 7.62 million in April. Gains were fairly widespread, with weakness limited to retail, finance, and accommodation and food services. The ratio of job openings to the number of unemployed rose from 0.95 in March to 1.03 in April. One month does not make a trend, but this is an encouraging report.
In April, the number of hires fell by 419,000 to 5.12 million. Most sectors showed weakness, but mining & logging, construction, and government saw some nominal gains.
Separations decreased again (by 399,000) to 4.98 million in April. Total separations include quits, layoffs, and discharges, and other separations (retirements, death, disability, etc.). Quits are voluntary separations initiated by the employee, and the quit rate can measure workers’ willingness or ability to leave jobs. The level of quits moved down by 183,000 to 2.98 million, suggesting that workers seem a little less confident about leaving a job. Layoffs and discharges moved down by 192,000 to 1.69 million in April.
This JOLTS (Job Opening and Labor Turnover Survey) report is crucial for understanding the economy because it reveals the demand side of the labor market, showing not just if people have jobs (like the unemployment data), but how many unfilled jobs exist, how many people are hired, and how many are quitting or being laid off. Adding job openings to employment in the BLS household survey provides a proxy for labor demand, while the civilian labor force is a good proxy for labor supply. The latest data for both (April) shows a labor market that is more in balance, with labor supply edging down and demand improving in April. This is the so-called “low hire, low fire” labor market. To quote the 19th-century French philosopher Auguste Comte: “Demographics is destiny.”