No one ever said being an economist was easy, and when it comes to trying to map the current economic recovery, it continues to be most challenging and at times perplexing. From gross domestic product and consumer confidence to housing starts and unemployment, there are myriad ways to measure where we’ve been and where we’re going. However, one of the most telling sets of data is the monthly Job Openings and Labor Turnover Survey, known as JOLTS.
JOLTS collects data on job openings, hiring and “separations,” or employees leaving their jobs, giving us a much better look at all positions that are open — not filled — on the last business day of each month. A job is considered “open” only if a specific job exists, the work could start within 30 days and the firm is actively recruiting to fill the slot, thus painting a picture around business hiring intentions.
Hiring and separations are employer/employee relationships created or ended during the month. These include workers moving into and out of jobs or measures of “churn” in the labor market. All types of jobs, including full-time, part-time, seasonal and short-term, are counted. One important takeaway: If the number of workers quitting their jobs rises, which is included in separations figures, it implies that Americans are likely “confident” enough to leave their jobs and search for others. This release lags the larger Bureau of Labor Statistics monthly employment report.
Journalists, investors and traders, economists and policymakers have taken a special interest in JOLTS since the economic recovery began in June 2009. In fact, the Federal Reserve regularly cites JOLTS in discussions over whether to increase interest rates. It is one of Fed Chairwoman Janet Yellen’s favorite indicators. At a recent National Association for Business Economics policy conference, Yellen said “I am likely to supplement the data on employment and unemployment with measures of gross job flows, such as job loss and hiring, which describe the underlying dynamics of the labor market.”
With a slowly improving economy, this monthly release has become a much-followed gauge on the direction and pace of the economy. Here’s how the most recent JOLTS reports indicate that the retail industry is healthy and has returned to prerecession levels. (JOLTS data includes total retail employment for all retail sectors. NRF-defined segments, which exclude automobiles and gasoline, cannot be broken out.)
- Retail job openings edged up for a third straight month to 539,000 in June. That was the largest number of openings in June in the past 15 years, suggesting that retailers are having success in filling jobs.
- Hiring, which lags behind openings, increased in June to 792,000 from 782,000 jobs and was the strongest since November 2006, the month before the start of the “Great Recession.” It was also the highest level for any June since the country’s prior recession ended in November 2001. The “openings and hires measures” indicate employers are trying to fill more openings, signifying their contributions to the labor market and confidence in the economy.
- Total separations ticked up to 762,000 in June from 745,000, largely driven by workers quitting their jobs. This June had the fourth-largest separation level for any June since the series begin in 2000. While the term “quit rates” sounds negative, it has positive significance – an increase in quits implies that workers are confident enough to voluntarily leave current jobs for better ones. addition
Hires usually outnumber total separations, but during the Great Recession there were more separations than hires.