According to the news report by MarketWatch, job openings in the United States have climbed to a record 6.94 million in the month of July. This according to MarketWatch is a clear sign that America’s economy is booming and that it is entering the second half of the year at a gallop. Job openings went up by 117,000 in July, however the job openings rate remained steady at 4.4%. This number has remained unchanged since April this year.
According to the government report, job openings went up from 6.82 million in June. The data also showed that 5.68 million were hired in July versus another 5.53 million who lost their jobs. However, this kind of churn, according to economists, is common is an economy as large as the United States’.
The “quit rate”, which is the percentage of people who quit their jobs also went up to 2.7% in the private sector. The highest quit rate recorded was in 2001, when it went up to 2.9%. Also at near-record highs was the quit rate among workers, which was at 2.4%. However, the quit rates have only been recorded since 2000 by the US government.
Most of the time, when people quit jobs, it is because they have gotten higher paying jobs. And it is when people are confident about the economy that more people switch jobs. This is reflected in the data that the US government released this week.
Job openings were the highest in insurance, manufacturing as well as finance. However, it was not all good news for all sectors. The retail industry slashed new job openings dropped by 85,000, reflecting the current struggle the industry is going through as more and more people switch to online shopping, leaving brick-and-mortar retailers scrambling to stay afloat. The other sectors that saw declines in job openings were education as well as government.
The growth of the American economy jumped during the spring of this year, and the momentum has sustained itself through the summer too. Another reflection of the booming economy is that extremely low unemployment rates the country is seeing right now.
Currently, unemployment rates are at 3.9%, and lay-offs are at a 50-year low. Small business owners have also stated that they are more optimistic about the US economy now.
Thanks to the upbeat economy, companies are offering higher, more attractive pays and better benefits to reel in new workers and to retain the old ones.
Reuters reported that the Labor Department’s monthly report, JOLTS (Job Openings and Labor Turnover Survey), that gave these numbers, also reported a further tightening in labor market conditions and that employers are finding it harder and harder to find people to fill the open positions.
While the labor market conditions could lead to higher wages, economists are also cautioning that the shortage in workers over time could have a negative impact on economic growth.
The JOLTS report has also confirmed expectations that the Federal Reserve is going to increase interest rates once more in September during its policy meeting on the 25th and 26th. If this happens, it will be the third time this year that the Federal Reserve will have raised interest rates this year.
Market reactions to this data were positive. The Dow Jones Industrial Average and the S&P 500 both rose during the day’s trading despite getting off to a rocky start. The Nasdaq also showed gains during the day’s trading but ended low.
The 10-year US Treasury yields also went up by 2.98% to almost touch 3% growth for the first time since June this year.