Author: David I. Templeton, CFA, Principal and Portfolio Manager
Today's release of the Job Openings and Labor Turnover Survey (JOLTS) shows the demand for employees continues to grow. The JOLTS report is released with a one month lag, but July's figures are indicative of a very strong demand for employees. The July report shows openings increased 749,000 to a record for the Survey of 10.9 million open positions. The blue line in the below chart shows the number of individuals unemployed for the period ending in August.
Clearly, openings far outpace those looking for a job. The maroon line in the below chart shows the ratio of the number of unemployed individuals to the number of openings. Readings below one indicate there are more job openings than unemployed individuals. A result of this high demand for employees, the quit level has increased as seen with the blue line in the below chart.
Finally, the growth rate rate of openings is up 136% since April 2020, the date openings began to increase after the pandemic shutdown. Again, this rate of growth far outpaces the growth in hires. Enhanced Unemployment Insurance ended Monday, September 6, which we believe has been a recent headwind for actual job growth. As a result, strong job growth should occur in the balance of this year, all else being equal.
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