Will May’s JOLTS report mean another surprise for investors?
The Job Openings and Labor Turnover Survey, or JOLTS, for May 2014
The Bureau of Labor Statistics will release the Job Openings and Labor Turnover Survey, or JOLTS, for May on Tuesday, July 8.
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Key takeaways from last month’s report
- The U.S. economy had 4.455 million job openings as of the last day of April. This was well ahead of market consensus estimates of 4.025 million. This was also the highest reported level for the number of jobs since September 2007.
- Hiring levels, however, were disappointing. Employers added a net of just 2,000 jobs over March’s numbers, to 4.708 million. The hires and separations rates were the same as March’s, at 3.4% and 3.3%, respectively.
- Private-sector job additions proved dominant. Most of the increases came from this sector.
- All sectors, excluding construction and education & health services, reported a net increase in openings.
- Job openings were strongest in the retail (XRT), accommodation & food services (VCR), and manufacturing (XLI) sectors.
An increase in job openings gives you an indication as to which sectors have openings. But it doesn’t necessarily show you which sectors created the most jobs. Since this report trails the more popular and timely non-farm payrolls report, it has less of an impact on stock (IVV) and bond markets (BND). It also appears to take its cue somewhat from the latter report.
In May, non-farm payrolls increased by 288,000, dropping the unemployment rate to 6.1%. This was the lowest rate since September 2008. Both the JOLTS and non-farm payrolls figures suggest an improving labor market. As there has been a general recovery in the overall job market in the past two months, the JOLTS report should also prove positive.
What is the JOLTS report?
The JOLTS is issued by the Bureau of Labor Statistics, or BLS. The report includes monthly estimates of job openings, hires, quits, layoffs and discharges, and other separations. Although there’s a lag of one month in reporting, JOLTS data help measure demand for labor—employers’ need for employees—and track the economy’s health. Job openings measure the “stock” of vacancies. The one-day reference for job openings gives you a snapshot of the need for employees in different parts of the economy and allows the BLS to monitor change over time.
To see how small businesses have fared during the recovery so far, please read on to the next part of this series.