March 29, 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 fell to 11.266 million in February, down from 11.283 million in January. The number of open positions in the private sector decreased to 10.185 million in February, down 50,000 from 10.235 million in January (see first chart). Both remain at very high levels.

The total job openings rate, openings divided by the sum of jobs plus openings, was unchanged at 7.0 percent in February while the private-sector job-openings rate held at 7.4 percent (see first chart).

Two industry categories have more than 2.0 million openings each: education and health care (2.226 million) and professional and business services (2.088 million). Trade, transportation, and utilities (1.863 million), and Leisure and hospitality (1.705 million) are both above 1 million.

The highest openings rates were in leisure and hospitality (9.9 percent), professional and business services (8.7 percent), education and health care (8.5 percent), transportation, and utilities, trade (6.2 percent), and manufacturing (6.0 percent), and all are all above the pre-lockdown-recession private-sector peak of 5.1 percent (see second chart). Among the private-sector industry groups, only construction (4.8 percent) is below 5.1 percent.

The number of private-sector quits rose, coming in at 4.106 million, up from 4.032 million in January (see third chart). Trade, transportation, and utilities led with 1.061 million quits followed by leisure and hospitality with 863,000 quits, and professional and business services with 704,000.

The total quits rate rose to 2.9 percent for the month, up from 2.8 percent in the prior month while the private-sector quits rate was unchanged at 3.2 percent (see third chart).

The quits rates among the private-sector industry groups are still dominated by leisure and hospitality with a rate of 5.6 percent, well ahead of the number two, trade transportation, and utilities, with a 3.7 percent rate, and number three, professional and business services, with a 3.2 percent quits rate. All the major groups within the private sector have a quits rate above the average over 2001 through 2019 (see fourth chart).

The number of job seekers (unemployed plus those not in the labor force but who want a job) per opening fell to 1.078 in February, a new record low. Prior to the lockdown recession, the low was 1.409 in October 2019 (see fifth chart).

Today’s job openings data continue to suggest a very tight labor market. The tight labor market is leading to significant turnover among employees and contributing to the headwinds facing businesses as they try to boost production. Compounding the difficulties are continuing elevated price pressures and the disruptions to capital and commodity markets and the global economy due to the Russian invasion of Ukraine. Furthermore, the newly initiated Fed tightening cycle raises the risk of a policy mistake and adds to the extreme level of risk and uncertainty for the overall economic outlook.

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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