State of the Labor Market

September 2019 JOLTS Report: The Employer Pull Back Continues

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The labor market remains strong but is clearly slowing down.

Once again, the JOLTS report shows that the slowdown in the US labor market is being driven by weaker demand from employers. A continuation of this trend could mean the benefits that workers are seeing in this recovery could stall. 

Job opening growth has been negative for four straight months on a year-over-year basis. However, while openings have declined, actual hiring remains fairly steady. The result is that the average hire per opening has increased in recent months. This is the opposite of what we would see if employers were struggling to find workers to fill positions. 

The report continues to show a strong labor market, even if the pace of improvement is slowing down. Job openings outnumbered unemployed workers for the 19th straight month, which is something that has never happened before this current streak. The quits rate, while declining in September, remains somewhat elevated. 

The labor market remains strong but is clearly slowing down. The issue here is demand, not supply. Employers may be pulling back on hiring, but it does not appear to be affecting job seeker confidence just yet.

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