The massive number of job openings in the domestic labor market at the end of April tied July 2015 for the highest vacancy total the economy has ever seen, according to a report published Wednesday by the Bureau of Labor Statistics.
Job openings climbed by more than 100,000 that month to 5.8 million and have now gained in five consecutive months. April’s increase was due in large part to upticks in wholesale trade, up 65,000; transportation, warehousing and utilities, up 58,000; durable goods manufacturing, up 46,000, and real estate and rental and leasing positions, up 41,000.
The report suggests domestic employers were struggling to fill millions of positions across the country at the end of April — which is undoubtedly good news for job seekers. It’s worth noting, though, that not all industries were creating tens of thousands of new openings. Professional and business services companies, for example, saw their monthly vacancies decline by 274,000.
And it’s also not like employers are bending over backwards to hire just anybody off the street. The number of new hires made in April dropped to an eight-month low of less than 5.1 million, and the hires rate, which compares the number of hires made in a given month to the total size of the U.S. employment pool, dropped to its lowest level since August 2014.
The steep rise in vacant positions and relative dropoff in hiring may seem counterintuitive, but some analysts believe the disconnect stems from employers adopting unrealistic expectations of their applicants’ qualifications.
“With the supply and demand in the old days, if you had five or six of the seven skills they wanted, they’d work with you. Now, you start seeing job descriptions that have 20 requirements,” says John Fugazzie, a professor at Fairleigh Dickinson University and founder of the Neighbors-helping-Neighbors job search and networking organization. “You’re paying $60,000, and you’re asking this guy to have the skillset of a CEO? It’s silly, really, when you start looking at it. But it’s the reality out there.”
He also says the jobs that companies are currently trying to fill don’t necessarily match the skillsets of the unemployed today. Specialized fields like health care and social assistance were looking to fill more than 1 million jobs in April, and retail and accommodation and food services were collectively trying to hire for more than 1.3 million openings. This has created a hollowing out of the labor market in which there are plenty of positions for extremely technical and specialized positions and plenty of low-paying service jobs, but significantly less opportunity in between.
“[The recovery has] shifted the jobs. The ones that have come back are at a much lower wage rate,” Fugazzie says. “I’m still working at a seriously reduced salary from what I earned on average throughout most of my career. And there’s lots of people like me.”
It’s also worth noting that total voluntary quits in April edged down to their lowest level since January.
Quits are typically viewed as a good thing by analysts, as it suggests current employees are confident enough in their own financial situations and employment prospects to branch out on their own if their current job isn’t a good fit. A downtick in quits, even in the face of a record number of job openings, suggests employees weren’t necessarily feeling the labor market’s relative strength in April.
At the very least, though, April didn’t appear to be a month in which the nation’s pool of unemployed got larger. The number of unemployed individuals in the labor market that month actually declined by 46,000, according to the BLS. And the number of layoffs and discharges enacted that month dropped to its lowest level since September 2014.
The most recent job cuts report from consulting and statistics company Challenger, Gray & Christmas supported the notion that layoffs are on a downswing. The number of job cuts announced in May dropped to a five-month low of about 30,000. That’s down roughly 27 percent year over year.
The Challenger report indicates layoffs tend to tick down in summer and that the labor market could very well continue to see low levels of job cuts over the next several months.
But after May’s disastrous job creation report surprised the market last week, it’s unlikely employees will be feeling very good about their alternative employment options in the weeks to come. Layoffs may remain low, but the upcoming months’ prospects for hiring and voluntary quits aren’t looking great.
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Job Openings Tie All-Time High, But Hiring Declines originally appeared on usnews.com
