U.S. JOLTS: Finding Workers to Fill Job Openings Gets Harder

The Bureau of Labor Statistics reported that the total job openings rate increased to 4.7% during December and matched the record high. The job openings rate is the job openings level as a percent of total employment plus the job openings level. Finding workers to fill those openings, however, remained difficult. The hiring rate held steady at a strong 3.9%, but it remained beneath the openings rate as it has since early-2017. In this tight labor market, employers remain hesitant to let people go. The layoff & discharge rate dropped to 1.2%, about where it's been for two years. And with jobs plentiful, workers seem ready to seek out new positions. The quits rate held steady at a near-record 2.3%. The JOLTS data begin in 2000.

The private-sector job openings rate increased to a record 5.0%. In leisure & hospitality, the rate surged to 6.5%. In professional & business services, it rose to 5.9%, up from 4.1% twelve months earlier. In education & health services, the rate strengthened to 5.2% and approached the record high, but in trade, transportation & utilities, it eased to a still-strong 4.6%. The rate surged to a record 4.9% in construction, but in manufacturing, it fell sharply to 3.2% from a near-record high. The job openings rate in government declined m/m to 2.7%, but remained up sharply versus the 2009 low of 1.2%.

The level of job openings increased 2.4% in December and were up roughly one-quarter y/y at 7.335 million. Private-sector openings increased 3.0% m/m and were up by nearly one-third y/y. Construction sector job availability more than doubled y/y. Job openings in professional business services rose by roughly one-half y/y, and they rose by one-quarter y/y in leisure & hospitality. Openings in leisure & hospitality strengthened by roughly one-quarter y/y and rose to roughly the same degree y/y in education & health services. Trade, transportation & utilities job openings also increased by one-quarter y/y, and in the factory sector, openings gained 14.4% y/y. Government sector job openings rose 19.4% y/y.

The private-sector hiring rate held at 4.3%, but remained just below August's eleven-year high of 4.4%. The rate in leisure & hospitality was unchanged at 6.6%. In professional & business services it rose to 5.5%, but remained below the 5.9% August high. The construction sector's hiring rate held steady at 5.2%, but remained down from the January 2017 high of 5.8%. The hiring rate in trade, transportation & utilities jumped to a near record 4.5%, up sharply from last year's low of 3.6%. In education & health services, the rate surged to a record 3.4%. In manufacturing, the rate declined to a still-firm 2.7%. The hiring rate in government was steady at 1.6%.

Total hiring increased 7.1% y/y to a near-record 5.907 million. Hiring in the private sector rose 7.4% y/y with trade, transportation & utilities hiring strengthening 15.8% y/y. Educational & health services hiring jumped by roughly one-quarter y/y and leisure & hospitality improved 6.0% y/y. Construction sector hiring rose 19.6% y/y. Factory-sector hiring increased 1.1% y/y, but professional & business employment declined 3.4% y/y. Government sector hiring rose 2.6% y/y.

The overall job separations rate eased to 3.7%, but remained near the expansion high. The private sector separations rate slipped to 4.0%, down versus its cycle high of 4.3% reached in August. The separations rate in government held steady at 1.6%.

The level of separations strengthened 4.3% y/y to 5.545 million, though the level has fallen recently. In the private sector, they were up 4.9% y/y led by a 27.1% surge in the construction sector In educational and health services separations rose 18.2% y/y and in trade, transportation & utilities separations separations increased 8.5%. Leisure & hospitality job separations increased 4.6% y/y but in manufacturing, they fell 3.6% y/y. In the financial sector, separations increased 1.2%. Separations in the information sector declined 15.8% y/y and professional & business services job separations decreased 2.5% y/y. Separations in the government sector fell 4.0% y/y.

In another sign of a strong labor market, the level of quits rose 4.3% y/y to 3.482 million in December. The quits rate of 2.3% remained up sharply from 1.3% at the beginning of the expansion. The private-sector quits rate held at 2.6%. The rate eased in leisure & hospitality was a strong 4.3% and in professional & business services, the rate increased to 3.2%. In education & health services, the rate increased to 2.3% and in the financial sector it rose to 1.3%. In the factory sector, it fell sharply m/m to 1.5%, but remained higher than the 0.6% 2009 low. The government sector quit rate fell sharply m/m to 0.8%, but still was double the expansion low.

The level of layoffs increased 2.5% y/y to 1.697 million, and the layoff rate eased to a near-record low of 1.1%. In the private sector, the layoff rate held steady at 1.3%, down from the 2009 high of 2.2%. The professional & business services rate held at 1.9%, while in the information sector, it was 0.9%. In leisure & hospitality, the layoff rate remained high at 1.8% and in the factory sector, it was stable at 0.9%. The government sector layoff rate fell to a near-record low 0.4%.

The Job Openings & Labor Turnover Survey (JOLTS) survey dates to December 2000 and the figures are available in Haver's USECON database.

Encouraging Economic Development in High-Poverty Rural Communities is the title of today's speech by Federal Reserve Chairman Jerome H. Powell and it can be found here.