Fewer job openings in 44 states in July.
September 19, 2023
Total job openings dropped by 338,000 to 8.8 million in July. That is still 26% above February 2020 levels but the lowest pace of job openings since March 2021. The losses were broad-based and occurred across 44 states. The largest monthly decline was in Florida, which was one of the hottest job markets post-pandemic. Job openings there dropped by 66,000.
The pace of hiring also cooled across the country. The pace of hiring in Texas slowed the most. The largest losses in the national data were in professional business services, which was a primary driver of post-pandemic job gains. The largest level of losses occurred in Texas, North Carolina and New Jersey. The largest decline in the rate of hiring was in Louisiana and North Carolina.
The cooling in the Sunbelt mirrors the slowdown in the housing market. Employers are pushing hard to have workers return to their offices, which makes remote work less feasible.
Nationally, the ratio of job openings to unemployed job seekers receded from 1.6 in June to 1.5 in July. There were 39 states, along with the District of Columbia, that posted ratios either equal to or surpassing the national average. New Hampshire continued to top the list with a ratio of 3.7, implying nearly four job openings for each unemployed individual. North Dakota, Maryland, Vermont and South Dakota also reported ratios around 3. Meanwhile, states with large populations, such as California, New York and Texas were among the states that had the nation’s lowest ratios just above 1. No state had a ratio below the 1, which suggest labor markets remain tight, despite signs of easing.
Layoffs were unchanged in July. Increases in layoffs in Connecticut, Mississippi and New Hampshire were offset by a drop in layoffs in Texas, Arizona and Florida. There were little signs of spillover effects from the writers and actors strikes during the month. The number of idled workers due to strikes hit the highest level since 2000 in August. Those ranks are expected to rise, depending on how long the UAW strike, which started at midnight on September 14, lasts. Currently, 12,700 UAW workers are on strike at three plants and another 2000 workers were furloughed in response to those strikes as of September 18.
The quit rate fell to 2019 levels in July. The decline was broad-based, with 42 states and the District of Columbia reporting fewer quits in July; most states are reverting to their 2019 levels. This is at the same time that the premium for job hoppers is narrowing. The premium for job hoppers peaked above 16% between April and August of 2022. That premium slipped below 10% for the first time since July 2021 in August of this year.
Separately, the State Employment and Unemployment report for August showed job creation remain roughly the same in the South. Compared with other regions, the slowdown in labor demand in some Southern states has not translated to slower job creations or job losses in the region overall. After being the migration destination since the economy reopened, the South will likely experience weaker job creation like other regions later this year.
The impending disruptions from the SAG and UAW strikes may further dampen job openings.
Labor demand has moderated significantly in 2023 relative to the frenzied pace of 2021 and 2022. Wages have also cooled. High frequency job postings websites indicate that they will continue to decelerate as we move into the fourth quarter. Disruptions from the SAG and UAW strikes are ongoing and could take a substantial toll on payroll gains in October; we will not see that data until early November. Those shifts, coupled with the cooling in inflation we have seen, are expected to keep the Federal Reserve on the sidelines in September.
Labor demand continued to cool in June
Fewer job openings in 32 states.
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