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First Cut: June JOLTS data consistent with softer numbers, but a month out of date relative to Employment Situation

In June, the numbers for Job Openings and Labor Turnover (JOLTS) were softer. However, levels and rates continued at robust levels and the July Employment Situation leaves no doubt the next JOLTS report will firm up.

Job openings fell 24,000 to 7.348 million in June from May, and was the lowest level since 7.142 million in February when businesses were dealing with the aftermath of the partial federal government shutdown and initial impacts of slower economic activity. The rate dipped one-tenth to 4.6%, its lowest since 4.5% in February and 4.6% in May 2018.

Hiring fell 58,000 to 5.702 million in June from the prior month. The hires rate was unchanged at 3.8% in June and on track with the underlying trend. While the pace of hiring has slowed somewhat from much of 2018, it is still quite strong.

Fewer workers were separated from their jobs in June, down 76,000 to 5.481 million from May. The rate of separations was down a tenth to 3.6%, the lowest since 3.6% in December 2018. In spite of less vigorous economic activity, businesses are holding on to their current workforces where they can.

Net turnover — hiring minus separations — was up 221,000 was the pace of hires continues to surpass the level of job leavers.

The total number of workers quitting jobs was down 45,000 to 3.433 million in June and continues not far below series highs. The rate of quits was unchanged at 2.3% for a 13th straight month. Confidence in leaving a job — whether a new one is lined up or not — remains elevated.

As seen in the Beveridge Curve, the number of job openings compared to the unemployment rate reflects a tight labor market with little evidence of a fundamental change in direction in spite of some month-to-month fluctuations.


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