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The financial markets were caught off guard by the strength of the March employment report. Wall Street, however, should expect more of the same in the coming months as businesses' need for additional workers keeps growing.
Besides the highly watched Employment Situation figures, the Bureau of Labor Statistics publishes another report on the market called the Job Openings & Labor Turnover Survey (JOLTS). The former shows only net hiring. The latter documents the gross hirings and separations that comprise net hiring. The latest JOLTS data, released on Apr. 11, provide a better view of the demand for labor by showing the number of job openings at businesses.
In February (the JOLTS data are a month behind their more popular cousin) the number of private-sector openings climbed to 3.59 million. That's up nearly 16% from a year ago. What's more, the January tally was revised up to 3.53 million, from an originally reported 3.49 million.Demand is rising most in the service sector, where openings in business, education, health, leisure, and hospitality have increased by 268,000 in the past year. Manufacturing openings are also up.
While the March jobs data showed a drop in factory payrolls, the weakness has been in nondurable-goods industries such as textiles and apparel, which cut 9,000 production jobs in the past six months. Durable-goods producers, including computer and machinery makers, added 111,000 production workers over the same period.
Other signs of tightening job markets: Layoffs and discharges are down 17% from a year ago, and they posted a sharp decline in February. The number of workers who are leaving their positions voluntarily is creeping higher too, albeit in fits and starts. It appears that companies are winding down cost-cutting moves, while employees sense that better opportunities can be had at other employers.
Hiring trends should remain strong with economists lifting their 2006 economic growth estimates. As the labor markets tighten further, the JOLTS data will help track the strength of demand for workers. By James Mehring in New York