July 6, 2022 Reading Time: 3 minutes

The latest Job Openings and Labor Turnover Survey from the Bureau of Labor Statistics shows the total number of job openings in the economy decreased 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 open positions in the private sector decreased to 10.212 million in May, down from 10.627 million in April and a record-high 10.812 million in March (see first chart).

The total job openings rate, openings divided by the sum of jobs plus openings, fell to 6.9 percent in May from 7.2 percent in April while the private-sector job-openings rate fell to 7.3 percent from 7.6 percent in the previous month (see first chart). The May result for the private sector is the lowest since November 2021.

Three industry categories still have more than 2.0 million openings each: education and health care (2.166 million), trade, transportation, and utilities (2.016 million), and professional and business services (2.002 million). Leisure and hospitality (1.570 million) is above 1 million. The highest openings rates were in leisure and hospitality (9.1 percent), professional and business services (8.3 percent), education and health care (8.2 percent), transportation, and utilities, trade (6.6 percent), and manufacturing (6.0 percent) and all remain above the pre-lockdown-recession private-sector peak of 5.1 percent.

The number of private-sector quits fell in May, coming in at 4.270 million, down from 4.327 million in April (see second chart). Trade, transportation, and utilities led with 923,000 quits, followed by leisure and hospitality with 857,000 quits, and professional and business services with 754,000.

The total quits rate fell to 2.8 percent for the month, down from 2.9 percent in the prior month while the private-sector quits rate fell to 3.1 percent versus 3.2 percent in April. The current private-sector quits rate is the lowest since October 2021 and 0.3 percentage points below the record high 3.4 percent in November 2021 (see third chart).

The quits rates among the private-sector industry groups are still dominated by leisure and hospitality with a rate of 5.5 percent, well ahead of the number two, professional and business services, with a 3.4 percent rate, and number three, trade transportation, and utilities, with a 3.2 percent quits rate.

The number of job seekers (unemployed plus those not in the labor force but who want a job) per opening ticked up slightly to 1.034 in May from a record low 0.957 in April. Before the lockdown recession, the low was 1.409 in October 2019 (see third chart).

Today’s job openings data suggest the labor market remains very tight though somewhat less tight than a couple of months ago. Signs of an economic slowdown are starting to accumulate. Caution is warranted.

Robert Hughes

Bob Hughes

Robert Hughes joined AIER in 2013 following more than 25 years in economic and financial markets research on Wall Street. Bob was formerly the head of Global Equity Strategy for Brown Brothers Harriman, where he developed equity investment strategy combining top-down macro analysis with bottom-up fundamentals.

Prior to BBH, Bob was a Senior Equity Strategist for State Street Global Markets, Senior Economic Strategist with Prudential Equity Group and Senior Economist and Financial Markets Analyst for Citicorp Investment Services. Bob has a MA in economics from Fordham University and a BS in business from Lehigh University.

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