After nearly two years of being rangebound, between 5.5 and 6 million, the BLS’s JOLTS report – Janet Yellen’s favorite labor market indicator- showed that in June, the number of job openings soared by 461,000 from 5.7 million to a new all time high of 6.163 million, smashing expectations of a far more subdued print of 5.75K, and resulting in a job openings rate of 4.0%, also tied for record high.
The biggest increase in job openings was in the Professional and Business Services category, which rose by 179K, Education and Health services which rose by 123K, Construction up by 62K, and Trade transportation up by 41K. Curiously, even manufacturing job openings increased by 38K in June, while Other Services and Retail job openings both declined, by 62K and 42K, respectively. The number of job openings increased in the Midwest and West regions.
Now if only employers could find potential employees that can pass their drug test…
Earlier in the day, the NFIB survey report highlighted that the challenge for employers at the moment is to deliver wage gains despite less robust trends in profit. Taken from that survey: “While inflation remains low, reports of higher worker compensation continue to be strong, consisted with historically tight labor markets. Reports of increased compensation rose 3% to a net 27% . Rising compensation will attract workers back into the labor force, but it is a slow process. The frequency of reports of improved profit trends was unchanged at a net negative 10 percent reporting quarter on quarter profit improvements, historically an excellent reading and one of the best readings in this expansion. In spite of rising labor costs, owners are seeing decent bottom line performance.”
So far the wage gains have yet to materialize.
Aside from the unexpected surge in job openings, the rest of the report was more subdued, with the pace of hiring actually declining from 5.459MM to 5.356MM…
… a decline in the annual growth rate from 6.2% in May to 3.5% in June.
