News on unemployment figures continues to disappoint—the official unemployment rate remains elevated, and many metrics show slow job creation. We’ve often written growth creates jobs, not the reverse, and employment gains historically have always lagged economic recovery. What’s more, in looking at the BLS’sJob Openings and Labor Turnover report (JOLT), it appears current job creation is on pace with past recoveries.
The JOLT report complements the headline employment survey. Using different data, it looks at the number of job openings at month’s end, as well as hires and separations (layoffs, quits and discharges) that occur throughout the month. (Read more on JOLT here.) JOLT was reasonably positive in July, with increasing job opportunities, declining layoffs and increased quits (people who felt confident enough to leave their jobs). Net job creation (hires minus total separations) remained positive at 64,000 (vs. June’s 65,000), and as openings increased while hiring slowed, the average time it took to fill positions rose sharply to 25 days.
Exhibit 1 shows JOLT figures and the past two recessions (shaded bars). Job creation has been normally volatile. What’s more, today’s net job creation is in line with the early-to-mid phase of the 2002-2007 economic expansion. In other words, it’s where one might reasonably expect it to be two years after a recession’s end.
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