Job openings rose to 5.5 million in September, the Bureau of Labor Statistics reported Thursday morning, enough that there are now fewer unemployed workers for each job opening than any time since 2001.
That is the second-highest total number of advertised vacancies since records were first kept in 2000, following July’s 5.7 million mark. There had been just under 5.4 million openings in August.
The increase in job openings meant that the number of unemployment workers for each vacancy fell to 1.43 for the month, the lowest such ration since May of 2001. Then, the economy was just transitioning from the peak of the dotcom bubble into a recession.
Hiring, however, was flat in the month, at just over 5 million. Although the number of advertised openings is up 20 percent on the year, the number of actual hires was lower than in September of last year.
Although hiring has stagnated over the year, layoffs have also not significantly increased from a year ago. The result has been that net hiring has been strong enough to drive the unemployment rate down from 5.9 percent last September to 5 percent in October, the most recent month for which there is data.
Other details from Thursday’s report suggested that there was still more unemployment than is healthy. The quits rate was steady at 1.9 percent, below the level that economists see as normal. Officials and investors see higher quits as a favorable indicator, as they suggest that people are confident enough in their prospects for employment to leave a job. The quits rate, however, hasn’t budged in six months.
The JOLTS data, and the quits rate in particular, are statistics favored by Federal Reserve chairwoman Janet Yellen, who has cited quits as an indicator that the labor market is tightening.
At the moment, the Fed is looking for signs that inflation is rising toward its 2 percent target. In the past, quits have been highly correlated with wage growth, and faster wage growth would in turn signal higher inflation. In September, the quits rate remained well below where it would need to be to push upward on inflation,
“In our view, the quits rate will have to move up above 2.5%, which is where it was in the early 2000s, for wage gains to expand at a rate consistent with the Fed’s inflation objective,” the economists wrote.
The Bureau reported the numbers on job openings and hiring, which are adjusted for seasonal fluctuations, as part of its monthly Jobs Opening and Labor Turnover Survey. JOLTS, as its known, includes more details about hiring and firing than the more widely-known monthly jobs reports, and it is valued by investors for hints about underlying trends despite the fact that its release lags the jobs report by a month.
