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October 14, 2009

A look at another job market number

As we've written in this blog recently, U.S. labor markets are weak at present and are likely to remain that way for some time. Last week's U.S. Bureau of Labor Statistics' August JOLTS (Job Opening and Labor Turnover Survey) report provided further evidence of labor market weakness (see here and here), with both the vacancy and quit rates at record lows (the JOLTS survey has comparable data back to December 2000).

At the end of August there were estimated to be fewer than 2.4 million job openings, equal to only 1.8 percent of the total filled and unfilled positions—a new record low. This is an especially significant issue given the large number of people who are looking for work. The ratio of the number of unemployed to the number of job openings was greater than 6 in August. In contrast, that ratio was under 1.5 in 2007 and previously peaked at 2.8 in mid-2003, suggesting that finding a job right now is extremely difficult (see the chart).

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The quit rate moved back down to its record low of 1.3 percent, as relatively few people want to leave a job voluntarily in the face of such a weak labor market. At the same time, the rate of involuntary separations moved up from 1.6 percent to 1.8 percent, not far below the peak of 1.9 percent in April.

The low probability of finding a job has also caused the average amount of time spent unemployed to rise substantially. The average duration of unemployment is up from around 20 weeks in 2004 (the previous peak) to 26 weeks now, with those unemployed more than 26 weeks now accounting for 36 percent of all unemployed versus 22 percent in 2004. Congress is considering an extension of unemployment insurance benefits (currently due to expire December 31) as the mismatch between job openings and the number of people looking for jobs grows.

By John Robertson, a vice president in the Atlanta Fed's research department

October 14, 2009 in Labor Markets | Permalink

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Comments

It appears that your dates are wrong in the graph above (by one year). The "2001" recession is shown to have occurred in 2000, etc.

Posted by: ciel | October 16, 2009 at 01:55 AM

When all the jobs run out we're done. I mean, if the white house thinks Government is the answer, then why would they just give out money that working people earn?

I'm blessed to have 3 jobs. 1 makes me money, one is in a slowdown, and one is my own business. Can't make money doing that these days.

Posted by: Scentsy Bricks | July 06, 2010 at 01:17 PM

the graph of job market looks very positive as we have seen a continous rise in the market since 2007 and been steadly going up in 2008

Posted by: resume help | March 09, 2011 at 08:31 PM

Any discussion about the troubled job prospects for millennials must of course also make mention of their debt problems. The average student, according to Forbes, already carries $12,700 in credit-card and other kinds of debt. And nationwide, tuition debt just recently passed the $1 trillion mark.

Posted by: Market research job | December 07, 2012 at 08:35 PM

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