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Job Openings Edge Up in May, Hiring Strong

The number of job openings edged up in May, increasing for the for the first time since February as hirings continued to improve, the Bureau of Labor Statistics (BLS) reported Tuesday in its monthly ""Job Openings and Labor Turnover Survey (JOLTS)"":http://www.bls.gov/news.release/archives/jolts_07092013.pdf.

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According to the JOLTS, report, the number of persons unemployed for each job opening in May remained at April's level of 3.07 but was down from 3.09 in February.

The JOLTS data showed hiring in the first five months of the year was down from the same period in 2012--21,812,000 compared with 21,894,000--but nonetheless on a pace to exceed hiring last year. In 2012, there were 51,946,000 hires; year-to-date 2013 hires (extrapolated) would total 52,348,800. Full-year hires in 2012 topped 50 million for the first time since 2008.

The number of people leaving their jobs in the first five months of the year, 21,086,000, was 1.1 percent higher than the same period a year ago, when total separations were 20,857,000. Within that data, though, 11,033,000 people quit their jobs in the first five months this year, up 5.5 percent from 10,453,000 in the first four months of 2012. ""Quits"" are considered a sign of workers are confident of their ability to find new jobs.

Employment and jobs data have taken on an added significance in the wake of the announcement by the Federal Reserve that it would reduce its monetary policy stimulus once the unemployment rate dropped below 6.5 [COLUMN_BREAK]

percent from its current 7.6 percent. Fed Chairman Ben Bernanke, following the last meeting of the Federal Open Market Committee, hinted the Fed would taper its program of buying mortgage-based and Treasury securities later this year.

The number of ""layoffs and discharges"" in May dipped 2,000 to 1,739,000, the second highest level since June 2012, signaling continued turmoil in labor markets. Year to date, layoffs and discharges combined were down 555,000, or 6.3 percent, from the first five months of 2012.

The unchanged level of unemployed per job opening is a mixed signal, suggesting out-of-work individuals have re-entered the labor market and meet the definitional test for ""unemployed,"" which includes ""looking-for-work."" However, the ratio rose in April because job openings fell.

The number of unemployed per job opening fell sharply in the construction industry to 8.7 in May--the lowest level since September 2008--from a revised 10.9 in March. While the number of construction job openings rose, the number of unemployed construction workers dropped in May to 891,000, the lowest level since August 2008.

Unemployed per job opening rose to 4.5 in May from 4.0 in the manufacturing sector, which has shed jobs for the last four months.

The JOLTS report tracks flows within the labor sector, noting hirings and separations by month as well as the number of job openings at the end of a month. It is reported by BLS on a one-month lag. In addition to totals, data are reported on major industry sectors.

The number of unemployed persons per job opening has been declining steadily since peaking at 6.7 in July 2009, when the recession officially ended. The calculation is a function of the number of people unemployed, which fell to 11,659,000 in April--the lowest level since December 2008--and the number of job openings. Unemployment rose in May to 11,760,000.

_Hear Mark Lieberman on P.O.T.U.S (Sirius 124) on Friday at 6:20 a.m. Eastern._

About Author: Mark Lieberman

Mark Lieberman is the former Senior Economist at Fox Business Network. He is now Managing Director and Senior Economist at Economics Analytics Research. He can be heard each Friday on The Morning Briefing on POTUS on Sirius-XM Radio 124.
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