Job Openings Continue to Grow in 2012, Hires and Separations Less So

By Hathaway, Kendra C. | Monthly Labor Review, May 2013 | Go to article overview

Job Openings Continue to Grow in 2012, Hires and Separations Less So


Hathaway, Kendra C., Monthly Labor Review


At the end of 2012--42 months after the recession--job openings, hires, and separations had not yet reached their prerecession levels and rates; all three measures, however, had levels higher than they had the previous year

Data from the Bureau of Labor Statistics Job Openings and Labor Turnover Survey (JOLTS) indicate that the job openings level and rate continued to grow during 2012. On an annual basis, data that are not seasonally adjusted show that the average monthly number of job openings increased from 3.2 million in 2011 to 3.6 million in 2012. The average monthly job openings rate rose from 2.3 percent to 2.6 percent. The increases in average monthly hires and separations, however, were not as large. From 2011 to 2012, the average monthly number of hires ticked up from 4.1 million to 4.3 million while the rate held steady at 3.2 percent. Besides illustrating the preceding data, the following tabulation shows that the average monthly number of separations increased from 4.0 million in 2011 to 4.1 million in 2012 while the average monthly rate rose from 3.0 percent to 3.1 percent between the 2 years (data not seasonally adjusted):

               Number (thousands)

Category       2010    2011    2012

Job openings   2,848   3,151   3,632
Hires          4,051   4,140   4,333
Separations    3,971   3,969   4,140

               Rate (percent)

Category       2010    2011    2012

Job openings    2.2     2.3     2.6
Hires           3.1     3.2     3.2
Separations     3.0     3.0     3.1

JOLTS breaks down separations into quits, layoffs and discharges, and other separations. In 2012, quits contributed the most to the increase in separations. The average monthly number of quits increased from 1.9 million in 2011 to 2.1 million in 2012. The average monthly number of layoffs and discharges remained stable at 1.7 million between the 2 years.

JOLTS data provide measures of job openings, hires, total separations, quits, layoffs and discharges, and other separations on a monthly basis by industry (1) and geographic region. (2) JOLTS gauges labor demand and worker flows by collecting data from a sample of approximately 16,400 nonfarm business establishments. This article reviews changes in the estimates generated by the JOLTS measures over 2012, as well as how these measures have fared since the most recent recession. To do so, 2012 JOLTS data are compared with previous years' JOLTS data as well as other statistical series. JOLTS data are available beginning December 2000. In what follows, monthly averages or annual totals, neither of which are seasonally adjusted, are presented. Data for a specific month (e.g., December 2012) or quarter (e.g., the second quarter of 2012) are seasonally adjusted.

Job openings

Job openings--the number of openings on the last business day of the reference month--are a procyclical measure of the demand side of the labor market. That is to say, during an economic contraction employers tend to demand less labor, reducing the number of job openings they have or shedding them entirely. As labor demand decreases, employment also tends to decrease. By contrast, during an economic expansion employers tend to demand more labor, increasing the number of job openings they have. As labor demand rises, employment tends to rise. All in all, then, job openings and the Current Employment Statistics (CES) (3) nonfarm payroll employment estimates tend to have similar growth trends. (4) (See chart 1.)

In 2012, as well as in 2011, the total number of nonfarm job openings and nonfarm payroll employment tracked consistently. On an annual basis, the average monthly number of job openings increased 15.3 percent in 2012, from 3.2 million to 3.6 million. By way of comparison, in 2011 the average monthly number of job openings grew 10.6 percent. Similarly, nonfarm payroll employment showed a positive, increasing percentage of growth for both years. In 2012, average monthly CES employment rose by 1. …

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Job Openings Continue to Grow in 2012, Hires and Separations Less So
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