03/28/24

Job Openings Projected to Trend Back Up in April

The U.S. Bureau of Labor Statistics recently released its April Job Openings and Labor Turnover Summary. The monthly report revealed an unexpected 10.1 million job openings in April—compared with a revised 9.745 million in March—following three months of declines.

Economists expected 9.375 million job openings in April, according to consensus estimates on Refinitiv. Monthly job openings have dropped from the record of 12 million in March 2022 but remain well above the pre-pandemic benchmark of 7 million.

The number of job openings is viewed as an indication of the strength of the labor market and the broader economy. The largest increases in job openings were in these sectors: retail trade, healthcare and social assistance, transportation, warehousing and utilities. The resilient labor market data could prompt the Federal Reserve (Fed) to hike interest rates again in June, given the continued strong employment data.

“While the Fed is still talking like it is on the inflation-righting warpath, the resilience and strength of the job market have been remarkable.” - Mark Hamrick, senior economic analyst at Bankrate

Total employee quits changed slightly to 3.8 million in April, with a quit rate of 2.4%. Because employee quits are generally voluntary separations initiated by the employee, the quit rate serves as a measure of workers’ willingness to or ability to leave jobs. The number of employee quits increased in the wholesale trade sector but decreased in state and local government (excluding education).

Total separations decreased to 5.7 million (down 286,000), with a rate of 3.7%. Furthermore, the number and rates of both layoffs and discharges decreased to 1.6 million (up by 265,000) and 1%, respectively, from the previous month. Layoffs decreased in the construction and information sectors.

Employer Takeaways
The strong job openings report adds to the resilient data since the last Fed meeting. With that, many anticipate another interest rate hike in June. Later this week, the U.S. Department of Labor will report the number of jobs the U.S. economy added in May and the unemployment rate.

Employers will likely continue to have difficulties attracting and retaining workers, resulting in increased labor costs as they raise wages and offer competitive benefits to attract talent. Employers should continue to monitor employment trends to stay competitive in today’s evolving market.