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JOLTs: Strong Revisions Alleviate Some, But Not All, Concerns

November 5, 2019

Bottom Line: Job openings fell in September, but prior months' job opening and hiring tallies were revised higher. for the third straight month and were revised lower again for prior months. On a trend basis, job openings have been falling since early this year. Hiring, though, has continued to expand at a steady pace. An increase in hires to job openings is historically an important early indicator of weakness -- and this ratio has been rising for most of the year. That said, some of this could be the result of employers posting fewer openings, frustrated by their inability to find skilled labor. Nonetheless, this bears close watching going forward.

Job Openings FELL by 277k in September to 7.024 million, compared with market expectations for an increase to 7.063 million.

Government job openings FELL by 15k. Consequently, private sector job openings FELL by 262k. Over the past 12 months, there were 368k more job openings , 2,367k more than the March 2007 pre-recession peak level.

Job Hires ROSE by 50k in September to 5.934 million. Over the past 12 months, there were 264k more job hires , 465k above their November 2006 pre-recession peak level. Job Separations ROSE by 76k in September to 5.808 million. Over the past 12 months, there were 250k more job separations.

The Hires to Job openings ratio ROSE by 0.039 points from 0.806 to 0.845 and is modestly above its 12 month average of 0.790. The Number of Unemployed to Job openings ratio FELL by 0.01 points from 0.83 to 0.82 and is slightly below its 12 month average of 0.83. This ratio has been declining since its July 2009 peak of 6.7 amid some volatility.

Article by Contingent Macro Advisors