The number of job openings across the U.S. economy reached a 13-year high in June and workers showed increasing willingness to quit, signaling steady improvement in the labor market.
U.S. employers had 4.7 million job openings on the last business day of June, up from 4.6 million a month earlier, the Labor Department said Tuesday. That marked the highest number of openings since February 2001. The number of workers hired ticked up to 4.8 million from May’s 4.7 million.
Meanwhile, 2.53 million Americans quit a job in June, up from 2.49 million in May and the highest level since June 2008, when the U.S. economy was in recession.
Tuesday’s report, known as the Job Openings and Labor Turnover Survey, suggests mounting strength and more flexibility in the U.S. labor market. Companies posting more job openings and stepping up hires typically reflects stronger sales and an improved outlook for the U.S. economy. And when more workers voluntarily quit jobs, that’s usually a sign they are confident enough they’ll find other—often better-paying—jobs.
The latest figures suggest “there is little slack remaining in labor markets and that wage growth will pick up more quickly than it did at similar levels of the unemployment rate in past cycles,” Barclays economist Michael Gapen said in a note to clients.
A pickup in wages could influence when the Federal Reserve raises short-term interest rates, which have been near zero since late 2008. Fed officials have signaled they wouldn’t raise rates until some time in 2015, as long as the economy and labor market improves at the pace they currently project.
Fed Chairwoman Janet Yellen has pointed to the so-called Jolts report as a key measure to assess the health of the jobs market. “The number of people who voluntarily quit their jobs is noticeably below levels before the recession; that is an indicator that people are reluctant to risk leaving their jobs because they worry that it will be hard to find another,” Ms. Yellen said in a March speech.
As a share of total U.S. employment, the quits rate—reflecting the number of quits—remained unchanged at a historically low 1.8%. But the rising number of workers quitting jobs could signal that workers are becoming more confident and mobile. That reverses a trend from the recession of workers clinging to their jobs because they feel they can’t find better ones
The Labor Department’s primary jobs report—released on the first Friday of each month—has shown the economy adding more than 200,000 jobs a month for six consecutive months, the best such stretch since the late 1990s.
Article Source: http://blogs.wsj.com/economics/2014/08/12/rising-job-openings-quits-point-to-strengthening-labor-market/
