JOLTed Snoozer: Job Openings Unchanged As Hiring And Quits Unexpectedly Rise
After steep declines in US job openings accelerated in the last few months of 2023, prompting economists to pat themselves on the back for predicting a soft landing and validating their expectations for Fed rate cuts, only to see the trend reverse dramatically in the last month of 2023 when job openings unexpectedly surged back over 9 million in, only to reverse in January of 2024, moments ago the BLS came out with the latest Job Openings data (which as a reminder always lags the BLS by a month) and which showed that in February there was... virtually no change: that's right, after several very volatile months, the BLS reported that in February the number of job openings were flat at 8.756 million, practically unchanged from the (downward revised) 8.748 million in January, and right on top of the 8.730 million expected.
According to the DOL, in February, job openings increased in finance and insurance (+126,000); state and local government, excluding education (+91,000); and arts, entertainment, and recreation (+51,000); job openings decreased in information (-85,000) and in federal government (-21,000).
And speaking of revisions, just like in the payrolls report, here too the BLS appears to be tasked with making a great, if erroneous, first impression then quietly revising it lower, and sure enough, 12 of the past 14 months have seen job openings revised lower, just like everything else in Biden's economy.
Accurate or not, the unchanged number of job openings coupled with the recent jump in unemployed workers meant that in February, the number of job openings was 2.298 million more than the number of unemployed workers (which the BLS reported was 6.458 million), down significantly from last month's 2.624 million.
Said otherwise, in January the number of job openings to unemployed dropped to 1.36, a sharp slide from the January print of 1.43, and matching the lowest level since August 2021 and almost back to pre-covid levels of 1.3.
What was more interesting than the snoozer of a headline job openings print - which we are certain will be revised lower again next month as has been the case with everything under the Biden admin - was the number of quits: here we find that the number of people quitting their jobs, an indicator closely associated with labor market strength as it shows workers are confident they can find a better wage elsewhere - rose for the second month in a row, to 3.484 million up from an upward revised 3.446 million (vs 3.385 million reported initially).
And another interesting twist is that amid the stagnant level of job openings, not only did the number of quits increase, but so did the number of hires, which rose to 5.818 million - the highest since October 2023 - from 5.698 million despite a 44K drop in durable goods manufacturing hiring.
Finally, no matter what the "data" shows, let's not forget that it is all just estimated, and it is safe to say that the real number of job openings remains still far lower since half of it - or some 70% to be specific - is guesswork. As the BLS itself admits, while the response rate to most of its various labor (and other) surveys has collapsed in recent years, nothing is as bad as the JOLTS report where the actual response rate remains near a record low 33%
In other words, more than two thirds, or 70% of the final number of job openings, is estimated!
And at a time when it is critical for Biden to still maintain the illusion that at least the labor market remains strong when everything else in Biden's economy is crashing and burning, we'll let readers decide if the admin's Labor Department is plugging the estimate gap with numbers that are stronger or weaker (we already know that they always get revised lower next month).
