The latest jobs report was so impactful that it sent stocks to all-time highs and led many employers to breathe a sigh of relief that the the economy and the US hiring environment are continuing to improve. However, economists are warning to not celebrate too quickly, as the actual health of the jobs market is based on more than just one report.
A new release from the U.S. Department of Labor shows the number of job openings dropped slightly in March after hitting its highest level in nearly five years. This suggests many businesses are holding out to determine how, exactly, changes to the federal budgets will impact them. The data showed the number of open jobs dropped by 55,000 to 3.84 million in March. This came alongside figures that show the number of firings increased, while hiring was slower.
The lackluster economic expansion news is also likely to keep employers from beefing up their payrolls, Bloomberg reports. This slower growth is most likely due to the payroll taxes that went into place in the new year and are just now hitting consumers' wallets and affecting spending. Although hiring ticked up in April, hiring will still need to occur at a faster rate for wages to rise and economic growth to continue - two substantial factors that affect a company's decision to hire.
"Job growth is proceeding at a pretty moderate pace," said Robert Mellman, a senior economist at JPMorgan Chase & Co. in New York. "The tax hikes went up early in the year, we got this slowdown in retail sales, this slowdown in manufacturing output, and that raised the question about whether businesses would get very defensive or not. It looks like they slowed payroll growth in March and April."
Hiring and Firing
The DOL report noted that the number of workers who were hired in March dropped to 4.26 million. This was enough to lower the overall hiring rate to 3.2 percent, from the previous month's 3.3 percent. The biggest declines in job openings were in the professional and business services sector, with the healthcare industry and social assistance agencies coming in second.
The businesses that demonstrated the greatest demand for new workers were in the retail sector, while hotels and restaurants also posted more open positions.
DOL data showed 1.69 million people were fired in March - the highest number in four months. This is compared with the 1.57 million workers that lost their jobs in February. As for quits, 2.16 million workers left their positions, compared to the 2.29 million workers who quit in February.
All told, the separations rate came in at 3.1 percent, marking the third straight month of the same reading.
Bloomberg crunched the data and found that with 11.7 million Americans unemployed in March, this equates to about three people going after every one job opening, which is higher than the 1.8-to-1 ratio that was noted in the months just before the recession started.
Randy Marek's testimony is similar to those heard around the country. Marek, who was once an account executive and project manager, has been looking for a job since 2010.
"What I've been trying to do is just to keep myself in front of networking, in front of people that I know," he said, adding this his job search consumes about 30 hours of his week. "I just know if I get in the right place, I'll be a big asset. I just don't know why I can't."
However, a high quitting number isn't all bad, experts say. According to the news source, this may suggest workers are more confident that they can land a higher-paying position, or one more in line with their ultimate career goals.