This is one of two main jobs reports that we follow, the Job Openings and Labor Turnover Report, produced by the Bureau of Labor Statistics. The other is the monthly jobs report, which should be released on Friday. For some reason the JOLTS report released in a month is for the month two months earlier, while the employment report is for one month earlier. It will likely take a while for the new leadership at the BLS to begin producing reports with a lower level of revisions, so it isn’t a surprise that job openings for June and July were revised downward somewhat. Job openings in July were reported as 7.18 million, down 176,000 from openings in June.
The most notable item is that openings are now below the number of unemployed persons, which is typically taken as a sign of a loose labor market and a negative for the economy. Given the uncertainty about how these reports are produced and the ongoing cessation of illegal immigration, including voluntary and involuntary deportation, I would be cautious about putting a traditional interpretation on these numbers. I would also note that the ration of openings to unemployed persons typically is below 1, and that ratio was unduly elevated during and immediately following the epidemic as employers probably over-listed job openings due to the economic uncertainty. I view openings and unemployed persons as seriously flawed metrics in any event. Employers typically list job openings that they do not intend to fill, just kind of fishing to see who is out there. And a lot of unemployed persons are slackers who have no intention of working unless absolutely forced to.
Openings notably declined in health care, retail, business services, state and local governments and arts, entertaiment and recreation, but rose in construction, finance and insurance and manufacturing. Hires rose slightly to 5.31 million, driven entirely by the private sector, a good thing. Total separations declined slightly to 4.98 million. People quitting was essentially unchanged. I would also note that hiring was revised upward for prior months, while involuntary separations was revised down. All in all, a report that doesn’t really suggest weakness or strength in the labor market. I am hoping that the real dynamic is that we are eliminating illegal workers and replacing them with generally low-income native-born Americans who need to be working. (BLS Report)
