The US Job Openings and Labor Turnover Survey (JOLTS) reported total job openings surged to 5.753mn in July, up from the revised June level of 5.323mn. The 430k increase, which was led by better labor demand in the service sector, brought job openings to the highest level on record since the JOLTS data were first published in 2000. Trade, transportation and utilities (73k, previous: -12k), professional and business services (122k, previous: 106k) and leisure and hospitality (69k, previous: -34k) all reported solid increases in openings in July.
Openings for manufacturing employment (32k, previous: -23k) rebounded from June, and construction was flat (previous: -26k). As a share of total employment, the openings rate reached a fresh post-recession high of 3.9% (previous: 3.6%). Despite these increases in openings, however, hiring slowed a bit in July to 4.983mn (previous: 5.182mn), and the hires rate fell to 3.5% (previous: 3.7%). Hiring continues to trend higher, and the decline in July is in line with the historical volatility of the series.
"Elsewhere, the quits rate - one metric of labor market confidence - was unchanged on the month at 1.9%. Stable quits, along with fewer layoffs and discharges, led the total separations rate to fall to 3.3% (previous: 3.5%). Combining these data with figures from the Labor Department's employment report suggests that labor market slack continues to diminish; the ratio of unemployed job seekers to job openings fell to 1.44 in July (previous: 1.56), the lowest on record since 2000. On balance, the July JOLTS data suggest labor demand held up solidly at the beginning of Q3",says Barclays.
