Insight Into January 2011’s Terrible Job Numbers

The January 2011 BLS’s Job Openings and Labor Turnover (JOLTS)  offers some insight into the terrible jobs data for January 2011. 

There were 2.8 million job openings on the last business day of January 2011, the U.S. Bureau of Labor Statistics reported today. The job openings rate (2.1 percent), hires rate (2.8 percent), and total separations rate (2.7 percent) were little changed over the month. This release includes estimates of the number and rate of job openings, hires, and separations for the total nonfarm sector by industry and by geographic region. This release also includes annual estimates for hires and separations. The annual totals for hires and quits increased in 2010 while the annual total for layoffs and discharges decreased.

The number of job openings in January was 2.8 million, little changed from 2.9 million in December.  The job openings level has risen since the end of the recession in June 2009 (as designated by the National Bureau of Economic Research) but remains well below the 4.4 million openings when the recession began in December 2007.

The take from the above BLS graphics should be that there is yet no clear separation in numbers between hiring and firing.  In a jobs recovery, there are usually more hires then separations.  Further, a lot is made in the press about jobs skills mismatches which is impacting hiring, but overall jobs openings are still significantly under the pre-recession levels.

Job openings are only modestly above numbers seen in the bottom of the recession and are less than 75% of pre-recession levels.  Adjusted for population growth, job openings are less than 72% of pre-recession levels.

Through the bottom of the recession job openings averaged about 63% of pre-recession levels.  Thus, the economy is only about 1/3 of the way back to pre-recessionary job opening levels.

On a national basis, the employment economy is operating on a reduced scale.  The Main Street economy is the economy of the worker.  The worker does not have pre-recession opportunity and so the Main Street economy is not seeing strong recovery yet.  Joe Sixpack is still buying beer one or two cans at a time.

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