August Job Openings and Labor Turnover, Government Shutdown, et al

As i imagine you all know, Congress failed to pass legislation to fund the Federal government for the fiscal year beginning October 1st, halting all government services deemed nonessential beginning on that date, ​ie, Wednesday of this week.…that meant that the only report released this past week was the Job Openings and Labor Turnover Survey (JOLTS) for August, which was released on Tuesday by the Bureau of Labor Statistics…​other reports that were scheduled but not released this week included the Employment Situation Summary for September, also from the Bureau of Labor Statistics, and the August report on Construction Spending (pdf), and the Full Report on Manufacturers’ Shipments, Inventories and Orders for August, both from the Census Bureau…however, since the Fed is an independent agency, we did see the last regional Fed manufacturing survey for September: the Dallas Fed Texas Manufacturing Outlook Survey, which covers Texas and adjacent western Louisiana and southeastern New Mexico, reported its general business activity index fell to -8.7 in September, down from –1.8 in August, and down from +0.9 in July, indicating a modest plurality of Texas businesses were experiencing a slowdown in September, compared to a near even mix of business​ outlooks​ from Texas manufacturers in the prior months…

This week’s major privately issued reports included the ADP Employment Report for September, wherein the private payroll processor reported a 32,000 decrease in private jobs in September, the September report on light vehicle sales from Omida, aka Wards Automotive, (the source of the BEA’s data) which estimated that vehicles sold at a 16.72 million annual rate in September, up from the 16.07 million annual rate in August, and up from the 15.77 million annual sales rate in September of last year, and the Case-Shiller house price indexes for July from S&P Case-Shiller, who reported that their national home price index based on relative May, June and July home sales prices was 1.7% higher than their price index for the same three months of a year earlier…

The week also saw both of the widely followed purchasing manager’s surveys from the Institute for Supply Management (ISM): the September Manufacturing Report On Business indicated that the manufacturing PMI (Purchasing Managers Index) rose to 49.1% in September from 48.7% in August, indicating that a slightly smaller plurality of manufacturing purchasing managers continued to report a slowdown in various facets of their business in September, while the September Services Report On Business reported that their Services PMI fell to 50.0% in September, down from 52.0% in August, which would indicated an even balance between service industry purchasing managers who reported improvement in various facets of their business in September and those who reported deteriorating business conditions…

Job Openings Little Changed in August, Hiring, Layoffs and Job Quitting were All Lower

The Job Openings and Labor Turnover Survey (JOLTS) report for August from the Bureau of Labor Statistics estimated that seasonally adjusted job openings increased by 19,000, from 7,208,000 in July to 7,227,000 openings in August, after July job openings were revised 27,000 higher, from the 7,181,000 reported last month to 7,208,000 now….August jobs openings were still 5.5% lower than the 7,649,000 job openings reported in August a year ago, as the job opening ratio expressed as a percentage of the employed rose was unchanged at 4.3% in August, but was down from 4.6% a year ago…the largest percentage increase ​in job opening​s was the 106,000​ increase to 986,000 job openings in accommodation and food services, while job openings with the Federal government decreased by 61,000 to 77,000 (see table 1 for more details)…like most BLS releases, the press release for this report is easy to understand and also refers us to the associated table for the data cited, which are linked at the end of the release…

The JOLTS release also reports on labor turnover, which consists of hires and job separations, which in turn is further divided into layoffs and discharges, those who quit their jobs, and ‘other separations’, which includes retirements and deaths….in August, seasonally adjusted new hires totaled 5,126,000, down by 114,000 from the revised 5,240,000 who were hired or rehired in July, as the hiring rate as a percentage of all employed fell from 3.3% in July to 3.2% in August, and was also down from the 3.3% hiring rate in August a year earlier (details of hiring by sector since March are in table 2)….meanwhile, total separations fell by 110,000, from 5,221,000 in July to 5,111,000 in August, while the separations rate as a percentage of the employed​ also fell from 3.3% in July to 3.2% in August, which was also down from the separations rate of 3.3% in August a year ago (see details in table 3)…subtracting the 5,111,000 total separations from the total hires of 5,126,000 would imply an increase of 15,000 jobs in August, a little less than the payroll job increase of 22,000 jobs in August reported by the August establishment survey a month ago, but still within the expected +/-110,000 margin of error in these incomplete survey extrapolations…..

Breaking down the seasonally adjusted job separations, the BLS finds that 3,091,000 of us voluntarily quit our jobs in August, down by 75,000 from the revised 3,166,000 who quit their jobs in July, while the quits rate, widely watched as an indicator of worker confidence, fell from 2.0% to 1.9% of total employment, which was also down from the quits rate of 2.0% a year earlier (see details in table 4)….in addition to those who quit, 1,725,000 employees were either laid off, fired or otherwise discharged in August, down by 62,000 from the revised 1,787,000 who were discharged in July, while the discharges rate was ​statistically unchanged at 1.1% of all those who were employed during the month, which was also unchanged from the 1.1% discharges rate in August of a year earlier….meanwhile, other separations, which includes retirements and deaths, were at 295,000 in August, up from 269,000 in July, for an ‘other separations rate’ of 0.2%, same as in July and as in August of last year….both seasonally adjusted and unadjusted details by industry and by region on hires and job separations, and on job quits and discharges can be accessed using the links to tables at the bottom of the press release…

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During previous government shutdowns, missed reports were released on a delayed schedule up until such time as the agencies caught up to their previously published release schedule, so we expect that will be the case this time around too…when that happens, we’ll have at least a modest synopsis of what we’ve missed…

 

 

(the above is the synopsis that accompanied my regular sunday morning news links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion…if you’d be interested in receiving my weekly emailing of selected links, most of which are chosen from the aforementioned GGO posts, contact me…)