There are now more jobs available – but unfilled – in the United States than there were before the Great Recession began at the end of 2007. And employers are firing fewer workers than they did when times were good. But they are also hiring fewer people.
In a report this month, the Bureau of Labor Statistics said that employers reported in June they had 4.5 million available jobs that they were unable to fill. That is the highest number since 2007, and more than twice as high as the figure in October 2009, when the economy was officially beginning to recover, but there were no signs of that in the labor market.
That figure was contained in the monthly JOLTS report – Job Openings and Labor Turnover Survey. Until recently, the survey tended to get relatively little attention. In part, that is because the survey began in 2000, so there is relatively little history, and in part it is because the figures are released more than a month after the jobs numbers for the same month come out, making them seem like old news.
But since Janet L. Yellen, the chairwoman of the Federal Reserve, began to cite them in her assessment of the economy, they have received more attention in the hope that they may provide a hint of when the Fed will begin to raise interest rates.
“The economy seems to be moving faster toward Yellen’s goal of eliminating slack in the labor market,” said Ed Yardeni, the chief investment strategist at Yardeni Research, after the JOLTS numbers were released.
In June, the three-month average of unfilled job openings was 4.57 million, with June’s figure at 4.67 million. It was the first time since the recession began that the three-month figure exceeded the 2007 average of 4.48 million.
The volume of firings soared during the recession but now is lower than it was before the downturn. The number of people quitting has recovered, but it is still well below the earlier level.
In March, Yellen noted that the number of new hires remained disappointing.
“I take the quit rate in many ways as a sign of the health of the economy,” she told a news conference. “When workers are scared they won’t be able to get other jobs, they show a reduced willingness to quit their jobs. Now, quit rates are below normal pre-recession levels, but on the other hand, they have come up over time, and so we have seen improvement. The job opening rate has also come up. The hires rate, however, remains extremely depressed, and I take that as a sign of a weaker labor market.”
The survey classifies employee departures in one of three ways, including workers who quit and those who are laid off or discharged. The third, and smallest, group includes workers who leave for other reasons, principally retirement or death, but also because of transfers. Because the survey covers individual working locations rather than entire companies, a worker who is transferred from one store to another could be classified as having left.