March 6, 2024

The  Labor Department reported that job openings fell 26 thousand in January to 8,863 thousand after having declined 42 thousand in December..  The pace of economic activity has been slowing a bit, but the labor market keeps hanging in there fairly well.  Job openings have fallen from their peak of 12,027 thousand in March of last year, but remain far higher than the 7,000 thousand level that existed prior to the recession.

As shown in the chart below, there are currently more job openings than there are unemployed workers.  Specifically, there are 1.4 jobs available for every unemployed worker.  Prior to the recession this rate was steady at about 1.2.  but if one looks at the last decade there are typically fewer job openings than there are unemployed workers.  As shown below, a ratio of 0.6 would be regarded as normal.

The Labor Department also provides information on hires each month.  Hires fell 100 thousand in January to 5,687 thousand after increasing 218 thousand in December  Employment remains quite steady.

The rate of job openings  was unchanged in January at 5.3 while the pace of hiring fell 0.1 to 3.6.   Thus, the ratio of job openings to hires rose slightly in January to 47.2%, which means that job openings continue to outpace hiring.  If that is true, employment should continue to climb in the months ahead.  Prior to the recession job openings were 15% higher than hires.  Unemployed workers today do not seem to have the skills required by employers, have chosen to become gig workers and go into business for themselves, are unable to find affordable day care, and/or are willing to live off generous government benefits for as long as they can.

The quit rate declined 0.1 in January to 2.1 after having been unchanged in December.  The willingness to quit one’s job has declined in recent months as workers concern about slower growth occurring in the not-too-far-distant future makes them slightly less willing to quit their job than they have been.  Prior to the recession the quit rate was 2.3.  It is slightly lower than where it was prior to the recession.

Stephen Slifer

NumberNomics

Charleston, SC