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  • Writer's pictureNick Andriacchi

April Jobs Report Shows Resiliency

4 takeaways from this months report:


· Temp Help is down for the second month in row.


· Nonfarm payrolls increased by 258,000 for the month, above the economists’ estimate.


· Large downward revisions in the employment report from February (-78.000) and March (-71,000).


· The JOLTS report estimates that there are 9.59mm open jobs, the lowest amount of open jobs in 2 years.



Analysis of the April Employment Report


Again, THE BIG NEWS FLASH here is that prime age labor participation rate (people aged 24 -55) is now above pre-pandemic level of 83.3%. This is fantastic news for employers and should really help to fill open jobs.


So now that the age group is fully working, why is the labor market still tight?


But overall labor force participation — that is the share of the total population either working or looking for work — is still slightly lower than where it was then.

That's partly to do with more older workers retiring.


The percentage of Americans aged 55 and over has doubled over the last 20 years and that population (the baby boomers) is expected to grow.


And while certainly many older Americans are working longer than ever before, they still do retire at some point. This was a demographic trend in place long before COVID-19 but was accelerated by the pandemic, which pushed many older workers into retirement.


Moody's estimates that 70% of the decline in labor force participation since the end of 2019 was due to aging workers — about 1.4 million additional Americans retired.


For a deeper dive:


· A more encompassing measure of unemployment (U6) that includes discouraged workers and those holding part-time jobs for economic reasons is down to 6.7%.


· Prime age labor force participation rate (ages 25-54) was up .2% to 83.3%.


· The overall labor force participation held steady at 62.6%. This number is disappointing as it still sits .7% below the level of February 2020.


· In April, average hourly earnings for all employees on private nonfarm payrolls rose by 16 cents, or 0.5 percent, to $33.36. Over the past 12 months, average hourly earnings have increased by 4.4 percent. In April, average hourly earnings of private-sector production and nonsupervisory employees rose by 11 cents, or 0.4 percent, to $28.62.


· The average workweek for all employees on private nonfarm payrolls was unchanged at 34.4 hours in April. In manufacturing, the average workweek was little changed at 40.2 hours, and overtime remained at 2.9 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls edged down by 0.1 hour to 33.8 hours.


· APD is reported that 296,000 jobs were added in last month.


Source: ADP, BLS, CNBC, Fox News




JOB OPENINGS AND LABOR TURNOVER – March 2023


The number of job openings decreased to 9.6 million on the last business day of March, the U.S. Bureau of Labor Statistics reported today. Over the month, the number of hires and total separations were little changed at 6.1 million and 5.9 million, respectively. Within separations, quits (3.9 million) changed little, while layoffs and discharges (1.8 million) increased. This release includes estimates of the number and rate of job openings, hires, and separations for the total nonfarm sector, by industry, and by establishment size class.

Job Openings


On the last business day of March, the number of job openings decreased to 9.6 million (-384,000) and was 1.6 million lower than in December. The job openings rate was 5.8 percent in March and was down by 1.0 percentage point since December. In March, job openings decreased in transportation, warehousing, and utilities (-144,000) but increased in educational services (+28,000).


Hires


In March, the number of hires was little changed at 6.1 million, and the rate held at 4.0 percent. Hires decreased in real estate and rental and leasing (-29,000).


Separations


Total separations include quits, layoffs and discharges, and other separations. Quits are generally voluntary separations initiated by the employee. Therefore, the quits rate can serve as a measure of workers’ willingness or ability to leave jobs. Layoffs and discharges are involuntary separations initiated by the employer. Other separations include separations due to retirement, death, disability, and transfers to other locations of the same firm.


The number of total separations changed little at 5.9 million in March, and the rate was 3.8 percent for the fourth month in a row. Over the month, the number of total separations decreased in accommodation and food services (-107,000) but increased in construction (+104,000).


In March, the number and rate of quits changed little at 3.9 million and 2.5 percent, respectively. The number of quits decreased in accommodation and food services (-178,000).


In March, the number and rate of layoffs and discharges increased to 1.8 million (+248,000) and 1.2 percent, respectively. Layoffs and discharges increased in construction (+112,000), accommodation and food services (+63,000), and health care and social assistance (+42,000).


The number of other separations was little changed in March at 276,000. Other separations decreased in finance and insurance (-31,000) and in real estate and rental and leasing (-7,000).


Establishment Size Class


In March, establishments with 1 to 9 employees saw a decrease in their job openings rate and an increase in their layoffs and discharges rate. Establishments with more than 5,000 employees saw little change in their job openings, hires, and total separations rates.

____________

The Job Openings and Labor Turnover Survey estimates for April 2023 are scheduled to be released on Wednesday, May 31, 2023, at 10:00 a.m. (ET).


https://www.bls.gov/news.release/jolts.nr0.htm

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