Job openings declined in large states

In line with the national trend, job openings declined in 15 states in May. Some states with larger populations, such as Florida, Pennsylvania and Colorado reported lower job openings. These three states, together with California and Michigan, accounted for nearly 50% of the total decrease in job openings nationwide from April. The outlier to the upside was Texas, which reported an increase of 3%. Texas has been experiencing a robust demand for labor; economic expansion has been supported by an influx of workers migrating from other states.

The national ratio of job openings to unemployed job seekers fell back to 1.6, as we saw in March. However, this is still higher than the pre-pandemic ratio of 1.2. In total, 39 states and the District of Columbia had ratios equal to or greater than the national level. South Dakota reported a ratio of 3.5. California and New York had the lowest job openings to unemployment balances in the nation, with a ratio of 1.1 each. Nonetheless, most states remained well above the balance point of 1.0 between job openings and job seekers, indicating that the demand for labor remains strong in every state.

The total number of hires increased in six states. Washington, Louisiana, and Oregon had the largest increases. Meanwhile, states in the New England region, such as Massachusetts and New Hampshire, experienced slowdowns in hirings; that led to declines in total payrolls for those two states in June.

Nationwide, the number of layoffs declined. Ohio, Illinois and Virginia experienced lower levels of layoffs as the economy continued to grow. Meanwhile, Georgia reported the highest number of layoffs and discharges among all states, with closures of warehouses and distribution centers contributing to the surge in layoffs. 

The national quit rate ticked up to 2.6%. Texas, New York and Alabama recorded the largest number of quits. This uptick in quits was a sign of the labor market's resilience. Given that those who change jobs often benefit from wage increase premiums, such quit rates could potentially sustain high inflation levels. The ADP report on payrolls revealed that job hoppers were still getting double-digit wage gains, while job stayers reported wage gains in the mid-single digits.