After recent reports that the US labor market had suddenly hit a brick wall, with mass layoffs surging…
… and job openings according to third-party trackers such as Revello showing that total job postings plunged by 22.5%, the biggest change on record…
… many were looking to see if these dismal trends would be confirmed by today's closely watched JOLTs report, arguably the Fed's favorite indicator of labor market softness (or tightness as the case is right now).
That did not happen, and instead the two-month delayed JOLTS report showed that in April, job openings did plunge by a whopping 455K, the biggest one month drop since the covid crash, but the drop was from an upward revised, and even higher record 11.855 million in March, to 11.4 million, the third highest on record.
According to the report, the largest decreases in job openings were in health care and social assistance (-266,000), retail trade (-162,000), and accommodation and food services (-113,000). The largest increases were in transportation, warehousing, and utilities (+97,000); nondurable goods manufacturing (+67,000); and durable goods manufacturing (+53,000).
What is just as remarkable, is that despite one of the biggest drops in job openings on record, the continued tightening in the labor market, there was a whopping 5.4 million more vacant jobs than unemployed workers in April (nearly double the 5.9 million total unemployed workers), confirming that the US labor market remains extremely tight.
And with far more job openings than unemployed workers, this meant that in April there were again less than 1 unemployed workers – a near-record low 0.52 to be exact – for every job opening.
With the number of job openings tumbling, it is not surprising that the number of hires also shrank, dropping from a downward revised 6.645MM to 6.586MM in April. According to the BLKS, hires increased in real estate and rental and leasing (+21,000).
One last observation comes from the April quits rate: after the number of Americans quitting their job hit an all time high 4.536 million in March, this number was since revised lower to 4.449 million, and the April print was 25K lower. Still, the 4.424 Million in April quits was one of the highest on record, and yet another indication that at least as recently as April, workers had all the leverage and were happy to quit their job in search of better paying options elsewhere, hardly the stuff that indicates that wage-price spiral is about to end.