It's the Economy

Dec. JOLTS Report: December Records

This week we received the December JOLTS Report. Last week we received the January Jobs Report.

The Job Openings and Labor Turnover Survey (JOLTS) Report lags the Jobs Report by one week. This is a different employment survey from the Current Population Survey (CPS) Jobs and unemployment survey.  It is different from the Current Employment Statistics (CES) worker data that used to create the headline “jobs” number. It is also different from the weekly continuing claims. These differences are important.

Last month the December Jobs Report, or Employment Statistics Report was extremely good.

  • Final Jobs Report of 2018 was Stellar” explained how the non-seasonally adjusted Current Employment Statistics worker data  rose while the non-seasonally adjusted current population survey jobs data fell.  The headline was that 312,000 seasonally adjusted non-farm payroll (NFP) jobs (workers) were added to the economy. The NFP number includes government workers.
  • Strong Worker and Wage Growth” explained how jobs growth could be a forward economic indicator.Non-seasonally adjusted (NSA) CES workers grew by over 2%, hours worked improved  by 3.20%, and hourly wages grew by over 4% year to year.
  • Five Presidents at 23 months” detailed how President Trump has added more full-time jobs during his first 23 months in office than former Presidents Reagan, Clinton, George W Bush, and Obama… combined. It also examined the unemployment rate and participation rate.
  • Men and Women: Record Level of Dec. Jobs” examined the number of Full-time and Part-time jobs workers were working, as well as unemployment level, the unemployment rates, and the participation rates by gender. It also examined the multiple job holder data.
  • Aging Workforce: December Records” examined the CPS Data for jobs and unemployment by age group.We had December record levels of employment and unemployment for those over the age of 55.

What happened this past December with record to the JOLTS data?

The JOLTS data  examines the worker data, by sector, and combined by regions. The JOLTS data is a survey of 16,000 Businesses. The CES data is a survey of 142,000 Businesses and 689,000 worksites. This data is available at the state and local level for some larger cities. The CPS data is a survey of 60,000 households. This measures the levels of full-time and part-time jobs. The JOLTS data does not distinguish between full-time and part-time jobs.

The Job Openings Data Set a record for the month of December. There were 6.890 million non-farm payroll job openings during December 2018. The most job openings were in the Education and Health Services (EHS,) Trade, Transportation, and Utilities (TTU,) Professional Business Services (PBS,) and Leisure and Hospitality (LAH) Sectors. The job openings data does not differentiate between full-time and part-time jobs. The total JOLTS data charts can be found here.

The Hires data recorded a record for the month of December. The sectors with the largest number of hires were the same four sectors: PBS, TTU, LAH, and EHS

The Quits data set a record for the month of December.  The four sectors with the highest level of Quits were the TTU, PBS, LAH, and EHS sectors.

The total separation data set a record for the month of December. The same four sectors had the most separations. The pattern is he same as the separations data: TTU, PBS, LAH, and EHS. The graphics for the monthly Job Openings, Hires, Quits and Separations can be found here.

The JOLTS data reflects the non-farm payroll CES data in a “funhouse mirror” sort of way. The headline JOLTS data is a seasonally adjusted value. The headline “Jobs data” is the seasonally adjusted  NFP  CES worker data. The participation rate and unemployment rates that are reported are based on the number of seasonally adjusted unemployed workers, the number of seasonally adjusted full-time job workers, and the number of seasonally adjusted part-time jobs. The workforce population data is not seasonally adjusted. The population data is annually revised.  Seasonal factors change by survey, JOLTS, CPS, CES, and even weekly claims. Seasonal factors change by month and category.Comparing JOLTS job opening data to Unemployment levels is similar to comparing siblings or cousins. Yes, they are related. NO, they are not directly comparable

We had 6.029 Million non-seasonally adjusted unemployed workers during December of 2018. We had 6.890 million job openings during December. The media will run with the FACT (False Assertion Considered to be True) that there are more job openings than unemployed workers. Two different data sets measuring two very different things. A red Apple versus a red Anjou Pear.

We had 1.764 million continuing claims unemployed workers during mid-December. Do we have four times the amount of job openings as we have unemployed workers? No.

We have a failure to participate. The Five Presidents Article included information on “missing participants.” These people are not unemployed, according to the U-3 data, nor the weekly claims data. There are over 10 million missing participants.

Comparing the jobs openings data with the number of unemployed workers is economic malfeasance. We have three surveys measuring three different things: Job Openings, Unemployed Workers, and Continuing Unemployment Claims. .You might as well be comparing a red apple to a red Anjou pear to a pomegranate.  We have a jobs mismatch. The jobs openings, hiring, quits, and separations are predominantly in four sectors. Three of these sectors are among the four lowest paid sectors: TTU, EHS, and LAH.  Are these job openings full-time jobs, part-time jobs, seasonal jobs, or permanent jobs?  The good news is that companies are posting jobs and they are hiring.

It’s the economy.

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