State of the Labor Market

July 2020 Job Openings and Labor Turnover Survey: Another Increase in Job Openings

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As of July, there are 2.5 unemployed workers per job opening.

Another increase in job openings is a heartening sign for workers who have permanently lost their jobs, according to the latest numbers from the government Job Openings and Labor Turnover Survey (JOLTS). While the outlook for workers looking for a new job is far worse than earlier this year, their prospects might not be as grim as the headline numbers would indicate. Still, this situation could deteriorate significantly if the economic damage from the coronavirus lasts.

As of July, there are 2.5 unemployed workers per job opening. There haven’t been that many out-of-work job seekers competing for a new job since early 2014. That ratio can mislead you, however, as many of these unemployed workers are on temporary layoffs and are waiting to be recalled. These folks likely aren’t looking for a new job. A measure that looks at workers more likely to be permanently displaced, core unemployment, shows the ratio of jobless searchers to open jobs as closer to 1.4. 

If the vast majority of workers temporarily laid off can return to their former jobs, the outlook for people permanently out of work may not be as dire as some think. But that assumption might be a big one. More lasting damage to the economy would result in more workers competing for fewer open jobs. The result would be a more cutthroat labor market for job seekers, where getting a new job quickly would be much more difficult.

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