U.S. JOLTS: Job Openings Rise, but Hiring Dips

The Bureau of Labor Statistics reported that the total job openings rate of 3.8% during February increased m/m, but remained below July's peak of 4.0%. The private-sector job openings rate improved to 4.1% versus 4.0% during all of last year. In the government sector, the job openings rate held steady m/m at 2.2%, down from 2.5% three months ago. These figures are from the Job Openings & Labor Turnover Survey (JOLTS).

Movement in the job openings rate by sector was mixed in February. The job openings rate in leisure & hospitality rose to 4.9%, the highest rate since March of last year. In education & health services the rate jumped to a near-record 5.2%. The factory sector job openings rate improved to 2.9%, up m/m and up from last year's 2.7% average. In construction, the openings rate rose to 2.4%, but was down compared to 3.4% in September. To the downside, in professional & business services, the openings rate fell m/m to 4.7% and was down from the 6.1% high in March 2016. The rate in retail trade declined m/m to 3.3% and was lower than the 3.9% during all of last year. 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 increased 2.1% (3.2% y/y) to 5.743 million, but was lower than the July high of 5.973 million. Private-sector openings improved 2.0% to 5.235 million, up 2.8% y/y. Construction job openings jumped 19.0% (-12.4% y/y), but remained 29.0% below last July's high. Professional & business services openings rebounded 13.8% m/m following sharp declines since July. Job openings in leisure & hospitality surged 10.8% (4.3% y/y). The number of openings in education & health services increased 8.5% (19.7% y/y). Factory sector job openings jumped 6.4% (4.6% y/y), but government-sector job openings declined 9.4% y/y.

The total hires rate eased m/m to 3.6% and remained down from the February 2016 high of 3.8%. The private-sector hiring rate dipped to 4.0%, still below the high of 4.2% reached last February. The hiring rate in leisure & hospitality fell to 6.3% and remained below the December 2015 peak of 7.0%. In professional & business services, the rate declined to 5.2%. In education and health services, the hires rate eased to 2.7%, equaling its lowest level since April of last year. The hires rate in construction fell to 5.4%. A 4.8% hires rate in retail trade was improved m/m but was still below last February's high of 5.3%. The government-sector hiring rate fell slightly to 1.5% and remained nearly the lowest level in roughly two years. The hires rate is the number of hires during the month divided by employment.

The number of hires declined 2.0% (-2.4% y/y) to 5.314 million. Private-sector hiring fell 2.0% (-2.5% y/y), while jobs in leisure & hospitality fell 2.6% (-5.9% y/y). Construction employment declined 4.7% m/m, but improved 6.3% y/y. Factory sector hiring was little-changed (6.3 y/y). The number of professional & business services jobs declined 5.3% (-0.7% y/y), but jobs in retail trade increased 10.9% (-9.0% y/y). Government sector hiring fell 3.1% m/m and declined 2.0% y/y.

The total job separations rate ticked down to 3.5%. The actual number of separations fell 3.4% m/m (-2.2% y/y) to 5.071 million. Retail trade separations eased 0.4% y/y. Leisure & hospitality separations declined 4.3% y/y. Professional and business services declined 3.4% y/y, but separations in the education and health services sector jumped 6.3% y/y. Factory sector separations declined 4.9% y/y. Going the other way, government sector separations rose 0.6% y/y. Separations include quits, layoffs, discharges, and other separations as well as retirements.

The layoff and discharge rate held steady near the record low at 1.1%, down from 1.3% two years ago. The private-sector rate eased to 1.2% versus 1.4% in February 2016. The government sector rate held at 0.5%. Total layoffs declined 13.6% y/y. Private-sector layoffs were off 13.9% y/y, while government layoffs dropped 10.7% y/y.

Large numbers of hires and separations occur every month throughout the business cycle. Net employment change results from the relationship between hires and separations. When the number of hires exceeds the number of separations, employment rises, even if the hires level is steady or declining. Conversely, when the number of hires is less than the number of separations, employment declines, even if the hires level is steady or rising. These totals include workers who may have been hired and separated more than once during the year.

The JOLTS survey dates to December 2000 and the figures are available in Haver's USECON database.