Job Openings Rocket to Record Highs
CAMS Weekly View from the Corner – Week ending 6/4/21
June 7, 2021
This past Friday the Bureau of Labor Statistics (BLS) released their monthly employment report for the month of May. Per the report 559,000 new jobs were created in May with a general expectation of around 670,000. The missed expectations get a lot of air play which often offers a tone that the miss reflects a still questionable employment backdrop. The employment market is just that – a market. Like any market there are bids and offers. Just because there are offers does not mean the offers will be matched with a bid and vice versa. If say a tire market has a plethora of tires standing ready for consumption (offers to consumers) but bids (end sales) is not what is expected would it be fair to say the tire market is weak? If yes is the answer than this infers the health of a market is gauged by the strength of the end consumer’s willingness to purchase tires. This says nothing of the fact that suppliers are standing ready to supply tires for purchase at the local tire market. Taking the above back to the employment market is it fair to say or even suggest the employment market is weak because end consumers of employment offers (workers) are choosing not to accept employment? In today’s edition we will change from our customary layout by going relatively light on commentary and heavier on pictures. With this, you can determine if the entirety of the employment market (“bids & offers”) is weak and questionable.
Click For Broader Presentation: https://tinyurl.com/af8h9b4h
Above is the ADP National Employment Report and is derived from ADP payroll data representing 460,000 U.S. clients and is published in collaboration with Moody’s Analytics. ADP does payroll processing and operates in the private sector. Monthly they share the above report as to what type of job growth they experienced throughout their 460,000 company clients. They are a non-government entity.
Click For Larger View: https://fred.stlouisfed.org/graph/?g=DW9u
Above are the Job Openings and Labor Turnover Survey (JOLTS) which is published by the Bureau of Labor Statistics. Dating back to inception of this data series our red line highlight emphasizes the number of jobs open and unfilled (8.1 million) represents a record high.
Click For Larger View: https://fred.stlouisfed.org/graph/?g=ExaD
Above is the well recognized job site known as Indeed. The chart depicts the percent change in new job postings since February 1st, 2020. Recall, back on that date, society was generally oblivious to a thing called Covid-19. (And we thought employers were searching high and low for employees back then with their consistent increase in new job postings; that pales in comparison to our current read via the chart.)
Click For Broader Presentation: https://www.dol.gov/ui/data.pdf
Above is from the Department of Labor (DOL) and denotes the number of Initial Unemployment Claims. Importantly, these are Initial Claims not Existing Claims. Initial Claims are published weekly and represent a good barometer of employment market health as employers are incentivized to layoff unnecessary personnel and employees are incentivized to claim in order to receive benefits in light of lost income. New Claims are now under 400,000 which historically suggests a healthy employment landscape.
Federal Reserve “Fed wants to be deliberately patient with monetary policy.” Cleveland Federal Reserve President Loretta Mester The above Federal Reserve quote is extracted from a CNBC interview given on Friday – post employment report release. They have emphasized all monetary spigots will remain wide open as our current inflation experience is “transitory” as we have shared in previous editions. Let’s hope they are correct. On that note, we had an interesting visual come our way this past week via a local building products company. As inflation (money becoming worth–less) always does, you get less for more.
I wish you well…
Director, Market Research & Portfolio Analysis
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