The latest job openings and labor turnover survey from the Bureau of Labor Statistics show that the total number of job openings in the economy fell to 11.254 million in May, down from 11.681 million in April and a record-high 11.855 million in March. The number of vacancies in the private sector fell to 10.212 million in May, from 10.627 million in April and to a record-high 10.812 million in March (see first chart).
Dividing the total job opening rate by the sum of jobs and job openings, it fell from 7.2 percent in April to 6.9 percent in May, while the private-sector job opening rate fell to 7.3 percent from 7.6 percent in the previous month (see chart first). May results for the private sector are the lowest since November 2021.
The three industrial divisions still have more than 2.0 million open each: education and healthcare (2.166 million), trade, transportation, and utilities (2.016 million), and professional and business services (2.002 million). Retirement and hospitality (1.570 million) above 1 million. The highest opening rates were leisure and hospitality (9.1 percent), professional and business services (8.3 percent), education and healthcare (8.2 percent), transportation, and utilities, trade (6.6 percent), and manufacturing (6.0 percent) and all pre -Lockdown-recession is above the pre-sector maximum of 5.1 percent.
The number of private-sector dropouts fell to 4.270 million in May from 4.327 million in April (see chart 2). Trade, transportation, and utilities led by 923,000 sacrifices, leisure and hospitality with 857,000 sacrifices and professional and business services including 754,000.
The total resignation rate fell to 2.8 percent for the month, down from 2.9 percent the previous month, while the private-sector discount rate fell to 3.1 percent from 3.2 percent in April. The current private-sector dropout rate is the lowest since October 2021 and 0.3 percentage points below the record high of 3.4 percent in November 2021 (see Chart 3).
Leaving rates among private-sector industry groups are still predominant in leisure and hospitality at 5.5 percent, well ahead of number two, professional and business services, at number 3.4 percent and number three, trade transport, and utilities, with a 3.2 percent discount.
The number of job seekers (unemployed and those who are not in the workforce but want jobs) rose slightly to 1.034 in May from a record low of 0.957 in April. Before the lockdown recession, October 2019 had a low of 1.409 (see third chart).
Today’s job opening data shows that the labor market is quite tight, although a little less tight than a few months ago. The signs of economic recession have begun to accumulate. Caution is inevitable.
Robert Hughes
Robert Hughes joined AIER in 2013 for more than 25 years researching economic and financial markets on Wall Street. Bob was previously head of Brown Brothers Harriman’s Global Equity Strategy, where he developed an equity investment strategy combining top-down macro analysis with bottom-up fundamentals.
Prior to BBH, Bob was a senior equity strategist at State Street Global Markets, a senior economic strategist at Prudential Equity Group, and a senior economist at Citicorp Investment Services and a financial markets analyst. Bob holds an MA in Economics from Fordham University and a BS in Business from Lehigh University.