Although the month-to-month changes in job openings, hires, and turnover data are often small, the trends over time are notable. The job openings rate remained essentially flat from August 2006 through September 2007 followed by an overall downward trend through July 2008. The hires rate has trended downward since July 2006. At 3.0 percent in two of the last three months, the hires rate is at the lowest level since May 2003. After remaining essentially flat for much of 2007, the separations rate began an overall downward trend in December 2007.
Job Openings
In July, the job openings rate was essentially unchanged at 2.4 percent. The rate has been trending downward and is at the lowest level since November 2004. Job openings include only those jobs open on the last business day of the month. In July, the job openings rate changed significantly only in retail trade, where the rate increased. Since the series began in December 2000, three industries consistently have had higher job openings rates than the other industries: education and health services (3.4 percent in July), accommodation and food services (3.3 percent) and professional and business services (3.2 percent).
Over the year, the job openings rate (not seasonally adjusted) rose significantly only in federal government (to 2.2 percent). The rate fell over the year for total nonfarm (2.5 percent) and total private (2.5 percent) as well as in most industries, including construction; durable goods manufacturing; nondurable goods manufacturing; wholesale trade; transportation, warehousing, and utilities; information; finance and insurance; professional and business services; educational services; accommodation and food services; other services; and state and local government. Regionally, the job openings rate fell over the year in all four regions.
Hires
The hires rate decreased in July to 3.0 percent and was at the lowest level since May 2003. Hires are any additions to the payroll during the month. The hires rate fell significantly in July for total nonfarm, total private, the construction industry, and the Northeast and South regions. The hires rate did not increase significantly in any industry or region in July. As occurs nearly every month, the seasonally adjusted hires rate was highest in accommodation and food services (5.6 percent) and lowest in state and local government (1.5 percent).
From July 2007 to July 2008, the hires rate (not seasonally adjusted) decreased significantly for total nonfarm (to 3.1 percent) and total private (3.4 percent), and in construction; durable goods manufacturing; nondurable goods manufacturing; information; real estate and rental and leasing; educational services; accommodation and food services; other services; and federal government. Regionally, the hires rate fell over the year in the Northeast, South, and West. The hires rate did not rise significantly in any industry or region over the year.
Separations
The total separations, or turnover, rate was little changed at 3.1 percent in July. Separations are terminations of employment that occur at any time during the month. Over the month, the separations rate did not change significantly in any industry or region. As often occurs, the seasonally adjusted separations rate was highest in construction (6.1 percent) and lowest in state and local government (1.1 percent). From July 2007 to July 2008, the total separations rate rose significantly only in the construction industry. The rate fell in nondurable goods manufacturing; finance and insurance; accommodation and food services; federal government; and state and local government. Regionally, the rate rose in the Northeast and fell in the South over the year.
Total separations include quits (voluntary separations), layoffs and discharges (involuntary separations), and other separations (including retirements). The quits rate, which can serve as a barometer of workers’ ability to change jobs, was unchanged in July for total nonfarm (1.7 percent) and has been stable since November 2007. The quits rate did not change significantly in any industry or region in July. As has occurred every month since the series began in December 2000, the seasonally adjusted quits rate was highest in the accommodation and food services industry (3.6 percent) and lowest in state and local government (0.5 percent).
From July 2007 to July 2008, the quits rate (not seasonally adjusted) did not rise significantly for any industry or region. The rate fell for total nonfarm (to 1.8 percent) and total private (2.1 percent), and for several industries, including durable goods manufacturing; nondurable goods manufacturing; finance and insurance; accommodation and food services; federal government; and state and local government. The quits rate fell in July in the South and West regions.
The other two components of total separations —layoffs and discharges, and other separations — are not seasonally adjusted. For July, the layoffs and discharges rate (1.2 percent) and level (1.7 million) were essentially unchanged from a year earlier. The layoffs and discharges rate increased significantly for total private and in construction; educational services; health care and social assistance; and the Northeast region. The rate fell for federal government and state and local government. The layoffs and discharges rate in July 2008 was highest in construction (3.3 percent) and lowest in federal government (0.2 percent). The other separations rate (0.2 percent) and level (269,000) were lower in July than a year earlier. The other separations rate was highest in July 2008 for transportation, warehousing, and utilities (0.4 percent). The other separations rate for most of the other industries range from 0.1 to 0.3 percent each month.
The total separations rate is driven by the relative contribution of its three components (quits, layoffs and discharges, and other separations), with quits contributing the largest portion. The percentage of total separations attributable to quits has varied over time. The proportion of total separations due to quits (seasonally adjusted) rose from a post-recession low of 50 percent in December 2003 to a high of 61 percent in December 2006 before trending downward again. Quits accounted for 54 percent of total separations in July 2008. The proportion of separations attributable to quits has varied the most over the history of the series in the construction industry (ranging from 26 percent to 55 percent) and in the Northeast region (ranging from 39 percent to 65 percent). The proportion of separations attributable to quits varies widely by industry with the highest proportion regularly occurring in the accommodation and food services industry (74 percent in July) and the lowest proportion regularly occurring in the construction industry (33 percent in July).
Flows in the Labor Market
Several industries consistently have high rates of both hires and separations. These include construction; retail trade; professional and business services; arts, entertainment, and recreation; and accommodation and food services. In the 12 months ending in July 2008, these 5 industries produced 31.8 million hires and 31.5 million separations, accounting for 58 percent of total nonfarm hires and 59 percent of total nonfarm separations while comprising only 40 percent of total nonfarm employment.
