Job Openings Drop To 5 Month Low Even As Hires, Quits Surge

Just in case the last few disappointing payrolls reports weren’t sufficient to warn the general public that the US economy is slowing, moments ago we got the latest JOLTS which confirmed that the US labor market is going through a rough patch, as the total number of job openings dropped again, sliding to 7.217 million, below the 7.331 million expected, and not only below the downward revised June print of 7.248 million, but was the lowest since February.

That said, even with the slowing number of job openings, there was still more than 1.2 million more job opening than unemployed workers; in fact there have now been more US job openings than unemployed workers for a record 17 consecutive months.

It wasn’t all bad news though: after last month’s sharp drop in the rate of hiring, total hires surged by 237K to 5.953 million, just shy of the record set in April with 5.991 million, and now modestly above where the payrolls implied number suggests:

The spike in hiring meant that from an annual contraction, hiring once again rebounded into the green, rising by 2.1% in July, up from a -2.0% drop in June.

Finally, in another bullish reversal, we saw the so-called “take this job and shove it” indicator – the total level of “quits” which shows worker confidence that they can leave their current job and find a better paying job elsewhere – reverse from last month’s disappointing drop, and in July, the number of quits surged by 130K from a 2019 low of 3.462MM to 3.592MM, just shy of the record set last August with 3.648MM.

Overall, a decidedly better JOLTS report than one would expect in light of last week’s poor payrolls number. Then again, recall that JOLTS is 2 months delayed, so we wouldn’t be surprised if next month’s JOLTs is where the real ugliness lies.