The July Job Openings and Labor Turnover Survey (JOLTS) data released this morning was essentially unchanged from the May and June reports. All top line measures—the rate of job openings, the hires rate, the layoffs rate, and the quits rate—have remained flat for two months in a row. In fact, the rate of layoffs has been flat since December 2013 and the quits rate has been flat since February of this year.
In her analysis, EPI economist Elise Gould notes that while businesses are no longer shedding workers, not only do layoffs need to come down, but hiring needs to pick up. Although it is slowly improving, the hires rate remains well below its prerecession level. Voluntary quits, which are an indicator labor market health, have been flat for the last six months and are nowhere near their prerecession level.
The ratio of job seekers to job openings increased slightly in July. The total number of job openings was 4.7 million (unchanged from June), while there were 9.7 million people looking for work—this means there were 2.1 times as many job seekers as job openings. In a healthy labor market, there would be roughly as many job openings as job seekers.
“Taken together with the lower than expected employment number in August,” writes Gould, the job seekers ratio “is enough to give us pause about what to expect in the future. Clearly, one month’s data cannot predict a trend, but it is reason to continue to watch these numbers in upcoming months to see whether they indicate the presence of a canary in the coal mine or simply a minor blip in trend.”
Finally, it is important to note that job seekers outnumbered job openings in every sector, which indicates that high unemployment is not the result of a skills gap. Instead, the main problem in the labor market is a broad-based lack of demand.