U.S. job openings declined in August for the first time this year — though remained near a record high — as demand for labor wavered slightly amid rising COVID-19 cases during the month.
The number of available positions eased to 10.4 million from an upwardly revised 11.1 million in July, according to recent data from the Labor Department’s Job Openings and Labor Turnover survey. The median projection in a Bloomberg survey of economists was for 11 million openings.
More people voluntarily left their jobs, underscoring how wage increases, sign-on incentives and a plethora of job vacancies are fueling significant turnover. The quits rate, or the number of quits in the month as a percent of total employment, increased to a record 2.9%.
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Despite the pullback in job vacancies, the still-elevated level of openings points to a persistent mismatch between labor supply and demand in the economy. Businesses ranging from manufacturers to restaurants are desperate for workers, but workforce participation remains depressed amid ongoing virus fears, choppy school re-openings and built-up savings accounts.
The abatement of these factors in the coming months should support hiring, but the timing of when this will occur is unclear. New COVID-19 cases are now falling, but labor force participation has remained stubbornly low around the same level for months. In fact, participation declined in September as fewer people looked for work.
For every unemployed American in August, there were 1.2 openings. Vacancies declined in health care, accommodation and food services, and state and local education.
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Total hires fell in August to 6.3 million, reflecting declines in accommodation and food services as well as education. The hires rate decreased to 4.3%. Layoffs and discharges decreased.
The JOLTS figures trail the government’s monthly jobs data. That report, out last week, showed payrolls trailed economists’ forecasts for a second month, rising just 194,000 in September. That was the smallest gain of the year. A new wave of Covid-19 infections in recent months paired with ongoing hiring challenges have weighed on job growth, particularly in sectors like leisure and hospitality.
Separate figures showed a record share of small-business owners — 51% — said they had vacant positions they could not fill in September, according to data from the National Federation of Independent Business. A record 42% of small firms said they raised compensation, and nearly a third indicated they plan to do so in the next three months.
Consumers have taken notice. In the Conference Board’s September survey, a record share of consumers said jobs were “plentiful.”
— With assistance from Olivia Rockeman and Kristy Scheuble.
