- US job openings rose to 10.9 million from 10.2 million in July, according to JOLTS data out Wednesday.
- The print exceeded the estimate for 10 million openings and marked a fifth straight record high.
- Job openings continued to exceed available workers despite the creation of 1.1 million payrolls in July.
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Job openings in the US rose to a record high for the fifth consecutive month in July as demand for workers still outpaced hiring.
Openings climbed to 10.9 million in July from 10.2 million, according to Job Openings and Labor Turnover Survey, or JOLTS, data published Wednesday. Economists surveyed by Bloomberg expected openings to dip to 10 million.
The print shows openings climbing for a seventh straight month. Openings shot higher through the spring as businesses faced unusual difficulty in hiring. The phenomenon – quickly deemed a nationwide labor shortage – was fueled by factors including enhanced unemployment benefits, school closures, and virus fears. As businesses prepared for reopening and a wave of spending, jobless Americans were in no rush to get back to work.
Openings rose at a slower pace through the summer as job growth boomed. The US added 962,000 jobs in June and another 1.1 million payrolls in July as vaccination and the reversal of lockdown measures supercharged the labor market's recovery. The hiring frenzy slowed sharply in August, but the latest JOLTS data shows labor demand was still strong the month prior amid stellar job creation.
The available-worker-to-opening ratio fell to 0.8 in July, signaling there were more job listings than workers to fill them. The measure fell below 1 in June for the first time since the pandemic recession began. It's unusual for the ratio to sit so low just one year after a historically dire economic slump.
A higher number of job openings than unemployed workers tends to come after years of economic expansion, but the huge number of unfilled job openings has quickly pulled the ratio to such low levels.
Struggling services and massive quits
Although the JOLTS report lags the government's monthly jobs data by one month, it provides more context to how businesses fared and where job demand was strongest.
Openings rose the most in the health care and social assistance sector, with a gain of 294,000 listings. The finance and insurance sector added 116,000 openings, and the accommodation and food services sector followed with a 115,000-openings gain.
The data shows service-industry firms rushing to rehire as the economy fully reopened. In-person services were among the hardest-hit businesses early in the pandemic as economic restrictions froze business and powered mass layoffs. As case counts fell and lockdowns reversed through the summer, those businesses counted for the bulk of job gains as they struggled to recoup their workforces.
Quits rebounded in July to roughly 4 million, falling just short of the record high seen in April. July marked the fourth consecutive month nearly 4 million workers have quit, signaling unprecedented confidence in the labor market. Workers tend to hold on to their jobs when they think finding a new opening would be difficult.
With job openings consistently rising to record highs, the elevated quits data suggests workers are taking the opportunity to find more rewarding jobs or move into different sectors entirely.