Job openings hit record high as job seekers dwindle
WASHINGTON - U.S. employers advertised 6.6 million open jobs in March, the most on records dating back to December 2000, suggesting businesses want to staff up to meet strong demand.
Job openings rose 7.8 percent in March from 6.1 million in February, the Labor Department said Tuesday. Yet overall hiring slipped, while quits increased.
The number of open jobs in March matched the number of unemployed that month. That's historically unusual: Typically, those out of work outnumber openings. Employers are struggling to fill jobs from a dwindling supply of unemployed. That should be pushing up wages, yet paychecks are growing at only a modest pace.
The number of people quitting rose 4.2 percent to 3.3 million in March, slightly ahead of December's total and the highest since January 2001.
The job market appears to be tilting in favor of workers and job-seekers. In July 2009, just after the Great Recession, there were 6.7 unemployed people, on average, for each available job. In March 2018, it fell to 1.
That should force employers to push up pay, and many economists expect wage gains will accelerate in the coming months.
"Employers beware," said Chris Rupkey, chief financial economist at MUFG Bank. "Wages have nowhere to go but up. It's just a matter of time."
Some data suggests workers are earning more: One measure of wages and salaries rose in the first three months of the year by the most in 11 years.
Yet a separate measure of average hourly pay increased just 2.6 percent in April from a year earlier, even as the unemployment rate dropped to a 17-year low of 3.9 percent. Wages rose at nearly a 4.5 percent clip the last time the unemployment rate fell below 4 percent.
Nick Bunker, an analyst at the Washington Center for Equitable Growth, said the record-high number of job openings in part stems from the weak wage gains. Typically, employers should post fewer jobs as the unemployment rate falls. That's because it takes more effort -- and expense -- to find workers when the jobless rate is low, and employers typically have to pay more to lure workers into jobs. That should discourage advertising more jobs.
But now, with wage gains sluggish, employers are willing to post more jobs because it won't cost them much to fill, Bunker argues.
Bunker added that economic research by the Federal Reserve suggests employers aren't poaching as many workers who already have jobs as they have in the past. More Americans are staying in their jobs rather than switching to new ones for higher pay. That's leaving more jobs unfilled and lifting openings.
Yet Tuesday's report, known as the Job Openings and Labor Turnover survey, or JOLTS, suggests that could be changing.
The number of people quitting their jobs has increased 6.4 percent in the past year, the JOLTS report shows. Workers typically quit when they have other jobs lined up, or they're confident they can find one. That's a sign job-switching could be recovering. Over time, it could push up wages.