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Economy in Brief

JOLTS: U.S. Job Openings Fell in July
by Tom Moeller September 10, 2008

The Bureau of Labor Statistics reported in the July Job Openings & Labor Turnover Survey (JOLTS) that the number of job openings fell a revised 2.3% (-17.0% y/y) from June. The drop followed a revised 3.7% June decline which was much larger than reported initially. Since the peak in January of 2007, the number of job openings have fallen 21%.

The job openings rate fell to 2.4% from a downwardly revised 2.5% in June. The latest figures are down from near 3% one year ago. The job openings rate is the number of job openings on the last business day of the month as a percent of total employment plus job openings.

The actual number of job openings in the construction sector fell 16.0% (-48.1% y/y) while the number of job openings in the manufacturing sector fell at the same rate as in June, by 3.3% (-29.6% y/y). Professional & business services job openings fell 10.4% (-12.4% y/y) while openings in the education & health sectors slipped 1.2% (-2.6% y/y) after an upwardly revised June increase of 5.2%. Openings in retail trade also reversed the prior month's decline with a 16.1% increase (-1.1% y/y).

By region, openings in the Northeast fell by 3.3% (-19.8% y/y). They were down by 5.6% (-15.1% y/y) in the South and off 4.3% (-15.3% y/y) in the Midwest.In the West openings rose by 5.3% (-20.2% y/y).

The hires rate fell to 3.0% from an upwardly revised June rate of 3.2%. The latest matched the low for this cycle and it was the lowest since early-2003.The hires rate is the number of hires during the month divided by employment.The actual number of hires fell 8.5% (-15.7% y/y). Hires in the construction sector fell by one-quarter m/m and they were off by one-third from last July. In the factory sector hires fell 11.2% (-28.7% y/y) and in the professional & business services sector they fell by 11.4% (-10.4% y/y). In the leisure and hospitality sector hires rose 4.6% during July but they still were off 10.8% y/y.

The job separations rate fell to 3.1%, the lowest since 2003 and down from 3.7% at the peak. Separations include quits, layoffs, discharges, and other separations as well as retirements. The level of job separations fell 3.5% y/y.

The JOLTS survey dates only to December 2000 but has since followed the movement in nonfarm payrolls, though the actual correlation between the two series is low.

A description of the Jolts survey and the latest release from the U.S. Department of Labor is available here.

The Budget and Economic Outlook: An Update from the Congressional Budget Office can be found here

JOLTS (Job Openings & Labor  Turnover Survey) July June July '07 2007 2006 2005
             
Job Openings, Total              
  Rate (%) 2.4 2.5 2.9 2.8 3.0 2.8
  Total (000s) 3,416 3,497 4,116 3,974 4,272 3,863
Hires, Total            
  Rate (%) 3.0 3.2 3.5 41.9 43.4 43.1
  Total (000s) 4,062 4,438 4,818 57,771 59,153 57,501
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