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JOLTs: Job Openings Slow

March 16, 2017

Bottom Line: The reported level of vacancies rose but left the January level slightly below its 6- and 12-month average. On a trend basis job openings have been mostly sideways, albeit amid volatility. Hires, meanwhile, have accelerated modestly again. Across all industries net hiring was positive. The quit rate rose slightly to 2.2%, while the layoff & discharge rate was unchanged at 1.1%. The number of job openings as a % of short-term unemployed (less than 27 weeks) is now 96.5% vs. 99.1% vs last month. On net, the fact that gross job flows were up moderately suggests that internal labor market dynamics are still solid. That said, the trend in job openings bears watching.

Job Openings ROSE by 87k in January to 5.626 million, compared with market expectations for an increase to 5.580 million. Government job openings FELL by 22k. Consequently, private sector job openings ROSE by 108k. Over the past 12 months, there were 87k more job openings , 969k more than the March 2007 pre-recession peak level.

Job Hires ROSE by 137k in January to 5.440 million. Over the past 12 months, there were 323k more job hires , 29k below their November 2006 pre-recession peak level. Job Separations ROSE by 174k in January to 5.258 million. Over the past 12 months, there were 225k more job separations.

The Hires to Job openings ratio ROSE by 0.010 points from 0.957 to 0.967 and is modestly above its 12 month average of 0.932. The Number of Unemployed to Job openings was unchanged at 1.36 and is modestly below its 12 month average of 1.37. This ratio has been declining since its July 2009 peak of 6.7 amid some volatility.

Article by Contingent Macro Advisors