Economic Snapshot: Job openings decrease in May

Though job openings decreased in May, the number of hires increased by nearly half a million.

JOLTS

The number of job openings decreased by 301,000 to 5.7 million on the last business day of May, the U.S. Bureau of Labor Statistics reported, and the job openings rate was 3.7 percent.

The number of job openings decreased for total private (-283,000) and was little changed for government. Job openings increased in retail trade (+72,000) and educational services (+17,000). Job openings decreased in a number of industries with the largest decreases occurring in construction (-46,000) and transportation, warehousing, and utilities (-45,000). The number of job openings decreased in the Midwest region.

The total number of hires rose 429,000 to 5.5 million in May and the hires rate was 3.7 percent. The number of hires increased for total private (+423,000) and was little changed for government. Hires increased in professional and business services (+121,000), other services (+78,000), and educational services (+25,000). The number of hires increased in the South region.

Total separations increased 251,000 in May and the separations rate was 3.6 percent. Total separations increased for total private (+245,000) and was little changed for government. Total separations increased in retail trade (+73,000) but decreased in federal government (-8,000). The number of total separations rose in the South region.

Among separations, quits increased by 177,000 to 3.2 million and the quits rate was 2.2 percent. The number of quits rose for total private (+159,000) and for government (+19,000). Quits increased in a number of industries with the largest increases occurring in retail trade (+66,000) and transportation, warehousing, and utilities (+20,000). The number of quits decreased in arts, entertainment, and recreation (-15,000). The number of quits increased in the South region.

NFIB small business optimism

The NFIB Small Business Optimism Index fell 0.9 points to 103.6 in June. The Index peaked at 105.9 in January and has dropped 2.3 points to date.

Four of the 10 index components posted a gain, five declined and one was unchanged.

“Economic growth in the first half of this year will be about the same as we have experienced for the past three or four years, no real progress. There isn’t much euphoria in the outlook for the second half of the year,” the report said.

Small business owners reported an adjusted average employment change per firm of negative 0.04 workers per firm over the past few months, basically zero. This follows May’s numbers, which was one of the best readings since 2008 posted. Ten percent (down 5 points) reported increasing employment an average of 3.4 workers per firm and 11 percent (up 2 points) reported reducing employment an average of 2.1 workers per firm (seasonally adjusted).

Fifty-four percent reported hiring or trying to hire (down 5 points), but 46 percent reported few or no qualified applicants for the positions they were trying to fill. Fifteen percent of owners cited the difficulty of finding qualified workers as their Single Most Important Business Problem (down 4 points), third on the list of important problems behind taxes and regulatory costs.

Thirty percent of all owners reported job openings they could not fill in the current period, down 4 points, but historically very high. A seasonally adjusted net 15 percent plan to create new jobs, down 3 points.

Employment situation

Total nonfarm employed increased by 222,000 in June, according to the U.S. Bureau of Labor Statistics. Employment increased in health care, social assistance, financial activities and mining.

The unemployment rate and the number of unemployed persons were unchanged at 4.4 percent and 7.0 million, respectively. Since January, the unemployment rate and the number of unemployed are down by 0.4 percentage point and 658,000, respectively.

The number of long-term unemployed (those jobless for 27 weeks or more) was unchanged at 1.7 million in June and accounted for 24.3 percent of the unemployed. Over the year, the number of long-term unemployed was down by 322,000.

The number of persons employed part time for economic reasons was little changed in June at 5.3 million.

In June, 1.6 million persons were marginally attached to the labor force, down by 197,000 from a year earlier. Among the marginally attached, there were 514,000 discouraged workers in June, little different from a year earlier.