According to the latest Job Openings and Labor Turnover Survey (JOLTS), the number of job openings rose unexpectedly in July, with about 11.2 million jobs available, slightly more than the revised total of 11 million vacancies in June. Economists, according to Refinitiv estimates, had expected about 10.5 million jobs to be created.
“This is a huge surprise on the upside,” said Julia Pollak, chief economist at ZipRecruiter, noting that the number of job postings on online job boards has declined, jobseekers’ confidence has declined, and reports of offers being canceled are increasing.
“We’ve seen all these headlines about layoffs and probably just the inflation experience has had a chilling effect on job seekers in recent months,” she said. “And yet in this report we see that companies are hiring en masse.”
According to the data, there were almost two jobs available per job seeker in July, up from 1.8 in June. That’s not what the Federal Reserve was hoping for: The Fed sees the near-record job openings as contributing to wage increases, which in turn could potentially keep inflation high.
“The Fed will not be happy with this report,” Mark Zandi, senior economist for Moody’s Analytics, told CNN Business. “It is critical that the job market cools down, and this report suggests it remained very strong in July.”
The total number of hires and departures decreased slightly from June. Just under 6.4 million people were hired in July, about 74,000 fewer than in June. The number of workers who left their jobs was 4.18 million, up from 4.25 million in June.
The number of layoffs remained unchanged at 1.4 million.
“This increase [in openings] underlines that some employers will continue to face workforce challenges,” said AnnElizabeth Konkel, senior economist at the Indeed Hiring Lab. “Employer demand for employees is still robust.”
This demand is more pronounced in certain sectors than in others.
In the accommodation and food services sector, there were just 88,000 layoffs and layoffs in July — a new all-time low, Pollak said. The average number of layoffs in that sector in 2019 totaled 215,000, data from BLS shows.
“That’s a very high turnover industry; it’s an industry that attracts people who are just starting out in the job market and learning how to keep a job,” she said. “So that that industry hardly fires anyone is remarkable.”
The former “one strike and you’re out” rules are now more in the 10-strike realm, she said.
“[Employers] feel that they absolutely cannot afford to lay off employees because they cannot afford to replace them,” she said.