Job Openings
At 2.9 percent in February, the job openings rate has been essentially flat since September 2006. In February, the job openings rate rose in the construction industry and fell in the Northeast region; no other industry or region experienced a significant over-the-month change in the job openings rate. The seasonally adjusted job openings rate was highest in February for the following industries: accommodations and food services (4.0 percent), education and health services (3.6 percent), and professional and business services (3.5 percent).
Over the year, the job openings rate increased in nondurable goods manufacturing; transportation, warehousing, and utilities; information; and other services. The rate decreased in durable goods manufacturing; finance and insurance; professional and business services; accommodations and food services; and federal government. The job openings rate did not change significantly over the year in any of the regions.
Hires
The hires rate was essentially unchanged at 3.5 percent in February.Hires are any additions to the payroll during the month. In February, the hires rate fell in the retail trade industry and in the Northeast region; no other industry or region experienced a significant over-the-month changein the hires rate. The seasonally adjusted hires rate was highest in February in the leisure and hospitality industry (7.1 percent).
From February 2006 to February 2007, the hires rate rose in educational services and federal government, but fell in construction; retail trade; information; accommodations and food services; and other services. Regionally, the hires rate increased over the year in the Midwest but decreasedin the South.
Separations
The total separations, or turnover, rate was little changed at 3.3 percent in February. Separations are terminations of employment that occur at any time during the month. In February, the only industry to experience a change in the separations rate was state and local government, where the rate declined slightly. None of the regions experienced a significant change in the separations rate. From February 2006 to February 2007, the total separations rate rose significantly only in federal government; the rate did not decline significantly in any industry. Geographically, none of the regions experienced a significant change in the total separations rate 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 little changed at 2.0 percent in February. Over the month, the quits rate rose in accommodations and food services but fell in state and local government. None of the regions experienced a significant change in the quits rate over the month. In February, the seasonally adjusted quits rate was highest in the accommodations and food services industry (4.6 percent).
Over the year, the quits rate rose in finance and insurance and professional and business services but fell in construction. Geographically, the quits rate declined over the year in the Northeast region.
The other two components of total separations-layoffs and discharges,and other separations-are not seasonally adjusted. For February, the
layoffs and discharges rate (0.9 percent) and level (1.2 million) werelittle changed from the prior year. The construction industry had the
highest layoffs and discharges rate (2.4 percent) in February. From February 2006 to February 2007, the other separations rate was unchanged at 0.2 percent and the level was little changed at 257,000.
Quits as a Percentage of Separations
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 risen and fallen over time
along with employment levels. Total nonfarm employment had peaked in February 2001 at 132.6 million, and then had fallen to a low of 129.8
million in August 2003. During the same time period, the proportion of quits fell from 61 percent in February 2001 to 51 percent in August 2003(seasonally adjusted). The proportion of quits has since risen to 60percent in February 2007. Between early 2001 and mid-2003, total separations fell by 613,000 but quits fell by a greater amount, 759,000,causing the proportion of total separations attributable to quits to
fall.
This change in quits as a percentage of total separations is especially pronounced in manufacturing, retail trade, and professional and
business services. Geographically, the regions averaged 61 percent of totat separations attributable to quits at the employment peak in February 2001. All four regions experienced a decline in the proportion of quits during the period of employment decline. The Northeast region's proportion declined the most, falling to a low of 39 percent. Since the employment trough in August 2003, the South and West have fully recovered to early 2001 levels of quits as a proportion of separations, but the Northeast and Midwest have not.
Flows in the Labor Market
Hires and separations data help show dynamic flows in the labor market. For the 12 months ending in February 2007, hires have averaged 4.9 million per month and separations have averaged 4.6 million per month (not seasonally adjusted). The comparable figures for the prior 12-month period were 4.8 million hires and 4.5 million separations.
Several industries have high rates of both hires and separations. These include construction; retail trade; professional and business services; arts, entertainment, and recreation; and accommodations and food services. In the 12 months ending in February 2007, these five industries produced 34.9 million hires and 32.9 million separations. Thus, these five industries accounted for 59 percent of total nonfarm hires and 59 percent of total nonfarm separations while comprising only 39 percent of total nonfarm employment.
