BLS says Job Openings > Number of Unemployed [Archive]

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dado potato

6-9-18, 5:45pm

The Bureau of Labor(ed) Statistics seems to be saying there is more than one job opening in America for every unemployed person over 16 years old.

In April 2018 (preliminary data) according to the "Job Openings and Labor Turnover Survey" there were 6,698,000 job openings in the US. The number of Unemployed Persons based on "Household Data" was 5,756,000 in May 2018.

I believe May 2018 will be the second month in a row when the BLS says job openings exceed the number of Unemployed Persons.

Of course there may be a mismatch between a particular unemployed person's skillset and place of residence compared with the vacant job duties and location.

iris lilies

6-9-18, 5:52pm

Pretty amazing statistic, yes?

Cue the apologists for misery who will give us all of the reasons why this is not,in realty, positive news.

actually, *I* have a reason why it is not positive news- it makes it damned harder to hire really good people! I am so glad
I no longer work. We had a rash of super great new employees in the economic downturn during the Obama administration. If I was working I might be saying “damn that Trump.”

JaneV2.0

6-9-18, 6:03pm

Our population is declining and immigration is down, which bodes an interesting future. If trump succeeds in driving out undocumented immigrants and refugees, the disparity between jobs and applicants will only increase.

dado potato

6-9-18, 6:10pm

Ya, me too, no longer in the paid workforce.

I understand that one of the jobs (back in January) with lots of openings around the country was "Masonry Helper". Hurrah for the right to bare arms!

razz

6-9-18, 6:25pm

IL, you are so amusing in your bias. Do you really think that the world started existing in January 2017? Really?

Job cycles go on much longer than one year. You know that. Depressions go on beyond one year. The triggers are set in place for highs or lows well in advance of them happening.

From John Mauldin's newsletter:
McKinsey calculated that from 2007–2014, world debt levels grew at a 5.3% compound annual growth rate. That was slower than the previous seven years but still considerably faster than the world economy grew. Hence, debt as a share of world GDP rose to 286%.

Not all the debt categories grew equally. Government debt grew far faster than household, corporate, or financial debt. Household debt growth fell to a relative crawl, from 8.5% annual growth in 2000–2007 to only 2.8% in 2007–2014. Which makes sense because families had little choice but to deleverage, often via bankruptcy.

Government and corporate borrowers faced no such pressure. Their debt kept growing at a slightly higher pace after the recession. Yes, some corporations hunkered down and rebuilt their balance sheets. Most did not. They kept borrowing and lenders kept lending, encouraged by central bank-generated liquidity.

This is an important point I’ll return to in future letters. We talk a lot about profligate governments running up debt, and rightly so, but they are not alone. Businesses are equally and sometimes more addicted to debt. That would be fine and even positive if it were funding innovation and new production. But much of this new corporate debt paid instead for share buybacks that reduce equity, leaving the corporation more leveraged. That seems to be what shareholders want. They should beware what they wish for...

The IIF report includes this note about US corporate debt:

US non-financial corporate debt hit a post-crisis high of 72% of GDP: At around $14.5 trillion in 2017, non-financial corporate sector debt was $810 billion higher than it was a year ago, with 60% of the rise stemming from new bank loan creation. At present, bond financing accounts for 43% of outstanding debt with an average maturity of 15 years vs. the average maturity of 2.1 years for US business loans. This implies roughly around $3.8 trillion of loan repayment per year. Against this backdrop, rising interest rates will add pressure on corporates with large refinancing needs.

I see at least three alarming points in this paragraph.

First, corporate debt is now 72% of GDP. That’s in addition to the government debt that is approaching (or has passed depending on how you count debt) 100% of GDP and household debt at 77% of GDP. Add in 81% financial sector debt, and the US combined debt-to-GDP ratio is near 330%.

Second, 60% of new corporate debt is coming not from bond sales but new bank loans—and those bank loans have much shorter maturity, averaging 2.1 years. That means refinancing time is coming for much of it, and rates are not going lower.

Third, IIF infers about $3.8T in corporate loan repayments each year*—just in the US. That’s a lot of cash companies need to find and I’m not sure all can do it. Aside from higher interest rates, the companies that need credit (as opposed to high-rated ones that borrow only because they can do it cheaply) tend to be riskier.

From a recent Moody’s report, we see that 37% of US nonfinancial corporate debt is below investment grade. That’s about $2.4Trillion.

Now, I know some readers will take comfort in the fact that 63% of the corporate debt is rated investment grade. But as they say in Texas, hold on, cowboy, don’t ride away so fast. A lot of that debt is rated BBB, the lowest investment grade rating. For the glass half-empty crowd, that means they are just one step above junk.
Lots of graphs and background information to these points at: https://www.mauldineconomics.com

Yppej

6-9-18, 6:27pm

How are they measuring unemployed workers? The traditional way that only counts those collecting unemployment benefits? Or are they adding in discouraged workers who have stopped looking and those who are underemployed? The latter group might be able to get the hours they want now.

Teacher Terry

6-9-18, 8:30pm

I think they continue to count only people collecting unemployment. Are those f.t Jobs or p.t? Of course skill sets might not match the region. Can people afford to move? Some places with lots of jobs rent is not affordable. So this week we are eating out and get talking with our waiter because it is slow. He rents a small house outside of town where it is cheaper. His rent went from 800 to 1400 which him and his wife can no longer afford. Turns out that they have family in Wichita, KS so are moving there where those types of jobs are plentiful and rent is cheap. Fortunately they have enough $ to move and for rent deposits. Having lived there twice I tell him it is a good move financially. Weather not so much

ToomuchStuff

6-10-18, 2:57am

Not enough data for an informed discussion. More then one job opening? Ok, so that means they could work as a fry cook, janitor, or CEO? (doesn't give information on job openings, cost of living, income, etc. etc. etc)

dado potato

6-10-18, 9:51am

I often wonder what gets counted as a job opening. A national trucking company might be hiring drivers (assume they want 140 more drivers to operate over the roads), but they bulletin the job opening in 3,000 cities and towns, in the belief that the newly hired driver could live almost anywhere and still be able to fit into the transportation network. So is that counted as 140 openings or 3,000?

Gardnr

6-10-18, 10:56am

I always wonder: what are the min quals? Do the available employees meet the min quals? Location of jobs? Location of candidates?

I'm always amazed at the openings here and the min quals. We're a college town so these should get filled....right?

Rent here is suddenly ridiculous Neighbor's 28yo son has moved back home. He and his roommate can no longer afford their rent-jacked up $600/m. And nothing else is affordable either.

Teacher Terry

6-10-18, 11:30am

We are having a big crisis here with rents being unaffordable. If something isn’t done there won’t be any workers in low wage jobs.

Yppej

6-10-18, 11:37am

We are having a big crisis here with rents being unaffordable. If something isn’t done there won’t be any workers in low wage jobs.

Or the employer will have to provide housing. That is done in my area for migrant apple pickers from Jamaica.

Teacher Terry

6-10-18, 11:54am

That would be a great solution but land here is very expensive and huge lack of inventory because they quit building in 2006. Also they tore down most of the affordable housing downtown and are putting in upscale apartments and condominiums.

Tybee

6-10-18, 12:26pm

When Obama care came in almost all of us adjuncts lost work because colleges did not want to pay health benefits and limited our hours.
Still cannot get those classes back so just because there might be an opening does not really help if the won't hire for more than 6 credit hours per semester

Teacher Terry

6-10-18, 12:40pm

Tybee

6-10-18, 1:17pm

Tybee, that is a bummer. Always unintended consequences seem to occur. You haven’t been able to work for more than one university? Luckily I only want to teach one class although I teach summers too.
Terry I started teaching when I was pregnant with my son who is now 36. I made 1999 per class. Today I make 1499 for same class. These are not adjusted dollars. I do teach for more than one but work has dried up and age discrimination is real.

Yppej

6-10-18, 1:33pm

I was originally planning to get a PhD in English but when I saw how academia is run I changed my mind. Several excellent teachers I know have been stuck adjuncting forever, even if they have published. Meanwhile in my state at least huge salaries and hundreds of thousands of dollars per person in cashed out sick and vacation time go to people at the top, many of whom have no educational experience but are political hacks including Billy Bulger, long suspected of having hidden the whereabouts of his brother Whitey Bulger.

There are other scandals too in the state, like nonexistent overtime by police officers, leading to a recent shutdown of Troop E. It is disappointing that our government is not a meritocracy. While there are certainly among public sector employees many good and dedicated full-time employees, I am not convinced that they are on average better human beings than those working in the private sector or those who lack the political connections to get full-time tenured positions in the public sector.

Teacher Terry

6-10-18, 2:02pm

Tybee, that is horrible. I get paid 222 per student because the funding source is different for online classes. I teach 39 students in fall and spring and 20 in the summer.

iris lilies

6-10-18, 11:03pm

Gardenarian

6-14-18, 4:11am

There is a good article in The Week on this topic:
http://theweek.com/articles/777601/americas-best-job-market-years

Lainey

6-14-18, 9:02am

There is a good article in The Week on this topic:
http://theweek.com/articles/777601/americas-best-job-market-years

From the article:
Inequality is worse, wage growth is slower, and more people are working as independent contractors, giving employers "more leverage to drive down pay and cut benefits." The headline numbers look great right now, but compared with 18 years ago, "3.8 percent unemployment just ain't what it used to be."
This, plus the one Trillion dollar deficit, is why there's no dancing in the streets over these numbers .. Just so glad I'm retired and out of the job market.

Tenngal

6-15-18, 3:24pm

The temp services are making a fortune here. $10 temp jobs in places that are not climate controlled.
The companies wear out one crew with promises of a perm job, lay them off and the process starts over again.
It is a shame.

sweetana3

6-15-18, 3:56pm

Sounds like Amazon here.

pinkytoe

6-15-18, 5:30pm

If there are so many available jobs, why are there young, homeless people multiplying in many places?

Teacher Terry

6-15-18, 5:46pm

You need a place to shower , etc to get a job.

sweetana3

6-15-18, 6:33pm

and an address. Oh, and a clean background and drug check in most cases.