The number of job openings declined again in April

June 18, 2024

Total job openings in the United States continued to decline in April, reaching eight million. That was a drop from 9.3 million as recently as September 2023 and the high of 12.2 million in March 2022. They remain above the 2019 monthly baseline average of 7.2 million.

Job openings decreased in 13 states in April, stayed roughly the same in 33 states and increased in four. Openings declined the most in California (-81,000), New York (-71,000) and Illinois (-65,000). Virginia (+46,000) and Arizona (+36,000) posted the largest gains.

Real-time data from Indeed show that job postings have plateaued after dropping to post-pandemic lows in several large markets, including Texas, Florida, New York and California. This points to a labor market that has cooled from recent highs and is leveling out at a more sustainable pace.

The ratio of job openings to unemployed job seekers, a metric of balance in the labor force, ticked down to 1.24 in April. That was the lowest since July 2021 and almost back to the pre-pandemic average. The ratio remains elevated in states such as Massachusetts (1.95), Maryland (2.11) and Virginia (2.19). It points to hotter labor markets in those states. The market is cooler in California (0.62), Washington (0.72) and New York (1.07).

The unemployment rate increased in 41 states in April compared to a year ago. It decreased in four states and stayed flat in six. The highest unemployment rates were in California (5.3%), the District of Columbia (5.2%) and Nevada (5.1%). Maryland (2.6%), Minnesota (2.7%) and Utah (2.8%) reported the lowest rates.

Similar to job openings, hire rates were on a downward trend or remained flat in most states. The rates increased in only four states. These include smaller labor markets such as Idaho (+1.0), Louisiana (+0.7) and Oklahoma (+0.7).

Quits showed a similar trend as job openings and hires in April. In fact, 42 states saw little change in the quits rate, whereas there was one decrease and seven increases. The quits rate remained unchanged in California at 1.5%, decreased to 1.8% from 1.9% in New York and decreased to 2.3% from 2.4% in Texas.

ADP data show that the wage premium for switching jobs declined to 7.8% in May. That is the third-lowest monthly rate since mid-2021. Wages for job stayers have remained at 5% for the past three months. The ratio of job changers to job stayers, a proxy for the incentive to quit and seek a new job, remained at 1.6 in May 2024. It has been on a downward trend since late 2020 and early 2021. That aligns with the quits data and shows a continued cooling in the labor market.

The trend of layoffs in April was similar to job openings, hires and quits. The number remained roughly the same in 35 states, while it decreased in 12 states and increased in three states. Layoffs grew in California by 39,000. They fell in New York by 24,000 and Texas by 18,000.