Job Openings Drop More Than Expected in December

The latest Job Openings and Labor Turnover Survey (JOLTS) report showed that job openings fell more than expected in December, while hiring and quits edged higher. Vacancies declined to 7.600 million, down from November's upwardly revised 8.156 million. The December figure came in below the expected 8.010 million and marked the second-lowest level of job openings since January 2021.

From the press release:

The number of job openings decreased to 7.6 million on the last business day of December, the U.S. Bureau of Labor Statistics reported today. Over the month, hires and total separations were little changed at 5.5 million and 5.3 million, respectively. Within separations, quits (3.2 million) and layoffs and discharges (1.8 million) changed little. This release includes estimates of the number and rate of job openings, hires, and separations for the total nonfarm sector, by industry, and by establishment size class.

Background on JOLTS (Job Openings and Labor Turnover)

The JOLTS report is a monthly survey released by the BLS that tracks job openings, hiring, and separations (quits, layoffs, and discharges). Unlike the unemployment rate, which measures labor supply, JOLTS data helps gauge labor demand. An increase in job openings is generally a positive sign, indicating ample job opportunities. JOLTS data lags the BLS employment report by one month. As a reminder, in December, the U.S. economy added 256,000 jobs, and the unemployment rate ticked down to 4.1%.

PAYEMS monthly change

The chart below displays the monthly data for the four components of the JOLTS series. Due to their volatility, six-month moving averages are included to highlight trends. The moving average for job openings remained above hires for over five years starting in 2015. It briefly dipped below hires in May and June 2020 but rebounded above in July 2020. Over the past two years, job openings, hires, and quits have all trended downward, with job openings falling the fastest. During that same time, layoffs and discharges have been gradually increasing.

JOLTS Overview

For comparison, here is the monthly BLS Employment Situation Summary charted with JOLTS data:

BLS Nonfarm Jobs versus JOLTS data

In December, there were 6.886 million unemployed workers and 7.600 million job openings. This equates to 1.10 jobs available per unemployed worker in December, down slightly from November and the third lowest level since June 2021.

Job Openings Per Unemployed Worker