The economy added 358,000 job openings in April after shedding positions in the first three months of the year, while the number of layoffs edged down, showing the perseverance of the U.S. labor market ahead of Friday’s employment report.
Job openings ticked up to 10.1 million from 9.7 million in March, off a recent peak of 11.2 million in December, the Labor Department reported Wednesday.
Layoffs fell 15 percent to a seasonally adjusted 1.58 million from 1.85 million in March, and the number of people hired into new jobs stayed constant around 6.1 million.
With 10.1 million available jobs and an unemployment rate of 3.4 percent, which amounts to 5.7 million people, the ratio of open jobs to job-seekers rose to 1.8 for April after falling to 1.67 in March — a balance weighted in favor of workers.
The number of workers quitting their jobs fell by 49,000 to 3.8 million as the quit rate dropped to 2.4 percent on the month, down from 2.5 percent.
The industries with the most job openings
The sectors with the most new open positions in April were retail trade with 209,000 openings, health care and social assistance with 185,000 openings, and transportation and warehousing with 154,000 openings.
Average hourly wages are $24.07 for workers in retail trade, $33 for health care and social assistance, and $28.80 for transportation and warehouse workers. Those jobs all fall below the national average wage, which was $33.36 in April.
Why the US job market is staying strong
The April rise in job openings once again proved analysts and economists wrong about the direction of the U.S. labor market, which has baffled market watchers throughout the recovery from the coronavirus pandemic.
Economists were expecting openings to decrease to 9.5 million rather than spike back up, according to consensus estimates.
Received economic wisdom about the labor market has been thrown out the window during the recovery. While many economic models prescribe that falling inflation must be accompanied by rising unemployment, the relationship between the two has been all but severed.
Inflation has fallen fairly steadily from a 9.1-percent annual increase last June to 4.9 in April, according to the Labor Department’s consumer price index (CPI).
During that time, unemployment has refused to budge from within a 0.2 percentage-point range of 3.5 percent. It now stands at a more-than-50-year low of 3.4 percent.
In response to elevated inflation, the Federal Reserve has been raising interest rates to slow economic activity and decrease consumer purchasing power. Current interest rate levels are now within the Fed’s target range for the end of this year of 5.1 percent.
That should allow the central bank to respond more freely to developments in the economy instead of simply making good on projections.
The persistent strength of the U.S. labor market is likely to factor into the Fed’s decision about whether to keep raising rates, especially if Friday’s jobs report comes in ahead of expectations.