There now are more job openings in the U.S. than unemployed workers to fill them
There now are more job openings in the U.S. than unemployed workers to fill them
Jim Puzzanghera Contact Reporter
The labor market has hit a tipping point that should help boost wages: There are more job openings in the U.S. than unemployed workers to fill them.
It’s the first time that’s happened since the government began tracking job openings in 2000.
There were a record 6.7 million job openings in April, the Labor Department reported Tuesday. That was an increase from an upwardly revised 6.63 million in March.
The revised data show that job openings outstripped total unemployed workers in March for the first time, and the trend continued in April.
There were 6.59 million unemployed workers in March and even fewer, 6.35 million in April, according to the Labor Department’s monthly report on job openings and labor turnover, also known as JOLTS.
“Never before have we had an economy where the number of open jobs exceeds the number of job seekers,” said Labor Secretary Alexander Acosta. “This administration is committed to ensuring that all Americans have the necessary skills to access good, family-sustaining jobs.”
Although the Labor Department job openings data only goes back to 2000, one analyst used private research on job vacancies to determine that the last time openings outnumbered unemployed Americans was 1970.
The biggest increases in job openings in April were in manufacturing of long-lasting durable goods, such as airplanes and machinery, as well as in the information sector. The business-services industry had the most openings in April with 1.3 million, followed by healthcare and social services, which had 1.2 million openings combined.
The Midwest had the highest rate of job openings at 4.8% of total employment and available jobs. The West, which includes California and 12 other states, was next at 4.4%.
Early in the recovery from the Great Recession in 2009, there were more than six unemployed workers for every job opening. That ratio has been narrowing ever since. In April, there was just 0.95 unemployed worker for every opening.
But some jobs are filled without posting a formal vacancy. And just because someone has a job, it doesn’t mean that they’re living comfortably.
The Labor Department counts people as employed if they did any paid work at all during the week in which the monthly survey is conducted. That includes part-time and temporary work, a growing type of employment in the so-called gig economy as more Americans act as independent contractors for services such as driving for Uber or delivering packages for Amazon.
“There are still workers that have not been able to find a job with the simple benefit of full-time, secure work,” said Martha Gimbel, director of economic research at employment website Indeed.
Among the fast-growing searches on the site are “full-time” “9 to 5” and “Monday through Friday,” she said. “Those searchers imply to me those workers may be seeing those opportunities now.”
Harry Holzer, a professor of public policy at Georgetown University who has studied low-wage workers, said some employers appear to be willing to keep jobs vacant rather than raise pay to fill them.
“It seems like they are more willing to live with the unfilled vacancies than with higher wages that could potentially cut into their profits,” said Holzer, a former Labor Department chief economist.
When workers are confident they can find another job, they quit their current ones more frequently. The so-called quits rate — workers leaving their jobs as a percentage of total employment — held steady in April at 2.3%. That’s the highest level since 2005.
The Labor Department classifies people as unemployed if they do not have a job, are available to work and have actively looked for a job in the previous four weeks.
The total U.S. labor force of employed and unemployed workers was 161.5 million in April. But there were about 96 million adults over the age of 16 who were not in the labor force.
Many of those are retirees or students. But some could be lured back into the workforce as job prospects and wages rise.
“This labor market is a headhunter’s dream as no company can hire the skilled or unskilled workers they need without an employment agency working for them 24/7 scouring the country for anyone they can find,” said Chris Rupkey, chief financial economist at MUFG Union Bank in New York.
“And they aren't finding much. Looking under every rock. Leaving no stone unturned,” he wrote in a research report.
The labor market is getting so tight that wages should begin rising faster as employers need to compete to lure and retain workers, Rupkey said.
“Wages may be just months away from heading into the stratosphere where they start producing wage-push inflation the country hasn't seen since the ‘60s and ‘70s, he said.
But Gimbel said economists have been expecting wage growth to accelerate significantly for several years now as the labor market has continued to tighten.
“Wage growth and economists are like Charlie Brown and the football,” she said. “We keep thinking it’s there and it’s not.”
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