WASHINGTON – U.S. employers advertised more jobs in May than in any month in the past seven years, a sign that this year’s strong hiring trend is likely to continue.
More Americans also quit their jobs, a good sign because it usually occurs when workers find new and higher-paying jobs. It also opens up more positions for those out of work.
Employers posted 4.64 million jobs, a 3.8 per cent increase from April’s total of 4.46 million, the Labor Department said Tuesday. That’s the fourth straight strong gain and is the highest number since June 2007.
The figures come after last week’s healthy jobs report and underscore this year’s steady improvement in hiring. Employers added a net total of 288,000 jobs in June, the government said last week, the fifth straight month of gains above 200,000. That’s the first such stretch in 15 years. The unemployment rate fell to a five-year low of 6.1 per cent.
Tuesday’s report, known as the Job Openings and Labor Turnover survey, offers a more complete picture of the job market. It reports figures for overall hiring, as well as the number of quits and layoffs. The monthly jobs figures are a net total of job gains or losses.
Some details of the report weren’t as encouraging. Employers have been slow to fill their open jobs, which suggests they are having trouble finding workers with the right skills.
Total hiring actually slipped in May, to 4.72 million from 4.77 million in the previous month.
But the number of people quitting their jobs rose 60,000 to 2.5 million, the highest level since June 2008. More quits indicate workers are confident about their job prospects.
Federal Reserve chair Janet Yellen has said she is tracking the overall hiring and quits figures as indicators of the job market’s health and dynamism.
Both quits and hiring remain below their pre-recession levels, evidence that the job market isn’t yet back to full health.
In the past year, job openings have increased nearly 20 per cent. But total hiring has risen just 4 per cent.
Some economists say that is a sign that many of those out of work don’t have the skills needed for the available jobs. Former construction workers or factory employees, for example, may not be able to fill new jobs in health care or other growing fields.
Others argue that companies will have to offer higher pay to attract the workers they need. That could boost overall wages, which have barely kept up with inflation since the recession ended five years ago.
There are other signs pay could rise soon. There are now 2.1 unemployed workers, on average, for every job opening. That is the ratio that typically exists in a healthy economy and indicates employers may have to try harder to fill jobs, perhaps by boosting salaries.
“We think the result is going to be a pickup in wage growth,” said Cooper Howes, U.S. economist at Barclays Capital.