For the first time since the pandemic unemployment is above openings.
Openings vs Unemployment Level
- Job Openings: 7.18 million
- Unemployment Level: 7.24 million
The trends in openings and unemployment are not good. Yet, Fed Chair Jerome Powell cites a strong labor market.
Job Openings, Hires, Separations, Quits
The Job Openings and Labor Turnover Summary (JOLTS) report from the BLS shows the labor market continues to weaken.
Job Openings
- The number and rate of job openings were 7.2 million and 4.3 percent, respectively, in July.
- The number of job openings decreased in health care and social assistance (-181,000); arts, entertainment, and recreation (-62,000); and mining and logging (-13,000).
Hires
- In July, the number and rate of hires were unchanged at 5.3 million and 3.3 percent, respectively.
- The number of hires increased in other services (+86,000).
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.
- In July, the number and rate of total separations were unchanged at 5.3 million and 3.3 percent, respectively. Total separations were little changed in all industries.
- In July, the number and rate of quits were unchanged at 3.2 million and 2.0 percent, respectively.
- The number of quits increased in professional and business services (+197,000). Quits decreased in construction (-80,000) and in transportation, warehousing, and utilities (-49,000).
- Layoffs and discharges decreased in professional and business services (-130,000) but increased in federal government (+5,000). The number of other separations decreased to 272,000 (-63,000) in July.
Revisions
- The number of job openings for June was revised down by 80,000 to 7.4 million, the number of hires was revised up by 63,000 to 5.3 million, and the number of total separations was revised up by 281,000 to 5.3 million.
- Within separations, the number of quits was revised up by 67,000 to 3.2 million, and the number of layoffs and discharges was revised up by 192,000 to 1.8 million.
Job Openings Per Unemployed Person
The ratio of openings per unemployed person dipped below 1.0 for the first time since April of 2021 at 0.96.
I believe openings are overstated and unemployment understated.
The survey response rate for JOLTS is about 34 percent
Response Rates and Survival Bias Issues
- First, firms that go out of business don’t respond. This is known as survival bias.
- Second, larger businesses are more likely to have someone who routinely answers such questions.
- Third, businesses of all sizes are deciding they have better things to do than answer BLS surveys.
- Fourth, businesses that are doing well are more likely to spend the time than businesses that are struggling or understaffed
The unemployment level is suspect too. Response rates are low, and given deportation concerns, who wants to answer the phone or respond to surveys?
The trends are accurate but the numbers are highly suspect.
Major BLS Errors
Every month, economists and the Fed rely on poor BLS monthly data to make decisions despite major modeling errors, data collection errors, and survival bias issues by the BLS.
The lagging QCEW and BEDS quarterly reports highlight the flaws.
QCEW Report Shows Overstatement of Jobs by the BLS is Increasing
On June 16, I noted QCEW Report Shows Overstatement of Jobs by the BLS is Increasing
The discrepancy between QCEW and the BLS jobs report is rising.
The QCEW consists of 12.2 million establishments in the first quarter of 2024. The BLS nonfarm payroll report has a sample size of 629,000 individual worksites in 2024.
The nonfarm payroll response rate is 42.6 percent with the same issues as with JOLTS.
Tomorrow, ADP reports August data, and on Friday the BLS reports nonfarm payrolls and unemployent.
The economy is more efficient when there are more unemployed than job openings. When there is a lack of available workers, companies are forced to hire the incompetent, lazy and miscreant. Productivity and quality goes down. For decades, when there was greater unemployment (except recessions), the middle class economy did fine. The only way unemployment fell to rising job openings was when the Fed added larger amounts of inflationary fiat to the national debt. To the point were the Fed has operated at a loss for the last 2.75 years, because the Fed can’t afford to pay interest on their debt.
Things will get a lot worse when businesses can’t find workers due to deportation.
Americans will take these jobs when they can’t get other jobs or someone else to support them.
If people don’t have money to buy things, there isn’t much reason for businesses to stay open to sell things.
ZH also noted today, that the employment participation rate has been falling, which has artificially kept the unemployment rate flat over the last several months.
https://www.zerohedge.com/markets/what-job-numbers-friday-will-it-take-fed-cut-50bps
This is pretty nonsensical since job skills don’t match openings. For example, nurses are always in demand while laborers are not.
Numbers are going to get a lot worse due to AI, Tarrifs and current labor costs with benefits. Also, able body adults that are currently collecting food stamps/benefits will have to work 20 hours per week. I think this also applies to Medicaid but I’m not positive if that started yet. Those that foolishly didn’t work will be paying the consequences.
The problem is simply that NOBODY is hiring, juxtaposed with modest numbers of newly unemployed . . . for now.
Again, go back 18 years and the final 3 months of 2007 is when the economy rolled over, with a Dec start to the Great Recession. As they say, history repeats itself. However, it’s not bad housing debt nowadays that’s the problem, rather it’s the Federal, state, local & corporate debt levels that are toxic.
False.
Real Estate prices are unsustainably high, hence mortgages taken to purchase homes are not serviceable unless owners are willing (and capable) to continue to lose money for years and decades to come.
At a time when even fast food is being purchased by Buy now pay later schemes?
At a point in history where the world is questioning the legitimacy of the unconstitutional Federal Reserve Notes as money, hence the credit worthiness of the American people?
This time it’s worse. Much worse.
Hyperinflation or nuclear confrontation.
Those are the only choices left.
And not much time.
Sure. Mortgages taken out over the last two years are too high, but since sales have been so low, this is not the kind of systemic numbers / debt we saw back in 2007. The other big factor is that the subprime market leading up to 2007 / 2008 was the primary cause of the Great Recession. Nowadays, even those with higher mortgage rates are in much better financial condition.
The later part of your post is true. My bad for not including consumer debt.
But housing debt is not a big concern. It’s much further down on the list than in 2007 when it was THE PRIMARY culprit.
In the end, we both agree that things are much worse this time around. I’m just saying the housing debt isn’t up at the top of the list this time around.
It really won’t matter what Real Estate and mortgage prices are when everyone is out of money. People who thought they were rich will suddenly be poor. You see, this is all the result of CDS (credit default swaps) of derivatives on a global scale. Let’s just call it what it is. It is bundles and bundles of bad loans traded with other banks for their bad loans and creative accounting …ie(scandalous accounting practices) in order to appear solvent over decades of mismanagement. Money that never really existed was loaned to borrowers who will never repay the loans. And that is why nobody will have any real money.
And, corporations large and small have no idea what the effects of Trumps random tariffs and attacks on free enterprise may bring ~ so it is foolish to add employees.
The job market is going below 0.5 jobs per unemployed person (twice as bad as now) before the coming recession is over.
And when you apply the first things they check are:
Your resume and application is screened by a diligent communist to ensure social justice goals are met.
If they don’t like any of the above things they won’t call you. Too much or too little experience- forget it. But if you faked your way through the right school that provided correct social brainwashing- you are IN!
Mish, please redo that chart to exclude all job openings from employer’s who are NOT hiring the most qualified applicant for the job willing to accept the advertised pay, instead they are hiring for diversity goals or whatever.
Conoco Philips just announced a 20-25% reduction in its workforce. That is after Chevron’s cuts of 15-20%. And BP 15%. And so on.
Low oil prices are lowering margins. People have to be let go to make up for it.
In Texas alone, 3000 oil jobs disappeared this summer. Rig counts have been dropping a lot in the last year. Breakevens for new shale wells are roughly $65/ bbl and the price today is $63.
In reading the Oil Journal and the EIA’s websites I have counted 23,000 jobs lost in the oil industry in the US since Trump took office and allowed Russia to export without effective sanctions.
Rig counts are down 16 out of the last 17 weeks and have dropped over 10% in the US since Trump took office.
US oil companies have reduced Cap Ex for 2025 by over 500 million dollars and that cancelled spending translates to job losses all across the oil patch. Profits are falling.
Costs for steel well casing pipe are up significantly as are fracking fluids.
Excess capacity at LNG terminals is rising precipitously and roughly 23 billion cu ft per day of permitted LNG export terminals are on hold as demand for US cargoes has fallen by just under ten percent.
Trump rolls out the Red Carpet for Putin and bitch slaps our oil industry and its workers.
Elections have reverberations through our economy!
Being a Trump supporter can be hazardous to your financial health!
Good post. Insightful info. Thanks!
Perhaps the available jobs aren’t where the masses of unemployed people are?
Government should closely examine and monitor anyone claiming disability benefits. We could probably put a million or more long-term disabled and collecting benefits back to work by doing this.
In this thread: Grandpa struggles to draw a clock while giving sage advice like “become a welder sonny!”, “just give em a firm handshake!”, and “I don’t see what tariffamabobs have to do with companies not hiring.” What a hoot!
The new trump economy. Taco can’t blame biden any more as this is his policies or lack thereof.
That s why he blame the bls
On the one hand, he inherited a bad hand.
On the other, he’s playing that hand horribly. (Breaking campaign promises about budget-saving peace, doing nothing with DOGE.) Plus he helped stack the deck poorly in his first term. We might say he set our nation up for more failure.
He created the band hand during his first presidency.
I dont know about numbers. Im pretty observant though. Seems to be less traffic on the roads in my area. Could be a bit of work from home but i doubt it. There also seems to be less business in restaurants. Those who are there seems to be more in the retired crowd. .
Sorry, but I don’t understand the analysis here.
In your first graph, the unemployment level was above the jobs openings from 2000-2017. And during that time period, the US experienced two recessions but also some majorly good boom times.
So why is it especially relevant if unemployment vs. job openings returns to that (recent) historical pattern? Especially if you think both data sets aren’t that reliable to begin with
yes and also the current job openings are well above the historical average from 2000 on. So really ,job openings are tracking down to there normal level . What seems to be going up is unemployment levels fro a relative historical perspective. The question is why so?
Mish, I’ve very much appreciated a long time ago when you brought up the “unemployment” the media uses, versus the U6 – the difference between U3 and U6 being the amount of “extra jobs or accepting lower jobs out of need” people have in finding sustainable work. From what I’ve been seeing, there are far more people dropping off the roles of U3 (and not being accounted for), and many more U6 who are running out of options.
Are these the U3 numbers? How much worse would the number look?
Those are U-3 Numbers
I will think about adding U-6
Mass Deportations Are Starting to Hurt Agriculture, Analysis Says
https://civileats.com/2025/08/19/mass-deportations-are-starting-to-hurt-agriculture-analysis-says/
I want to watch a crew of white boys try and cut broccoli for 10 hours.
It might get them off insulin injections.
If we are in the golden age of tariffs paying for everything, why is unemployment rising?
If millions of people are being deported, why is unemployment rising? Shouldn’t the opposite be happening?
If millions of boomers are retiring or expiring, why is unemployment rising? Shouldn’t there be gaps in employment?
Very strange happenings around here.
I agree with your first statement.
Thinking sarcasm on “The Golden Age of Tariffs”.8 months and its The Golden Age?
Millions of people are not being deported. Hell leftist judges wont even let America deport an illegal alien who was involved in human trafficking drug smuggling and beating his wife, twice.
Mostly true on boomers
The elephant in the room not talked about is we don’t reproduce. 1970s in NY most families had 3 kids, everyone on my street had 3 except 1 family had 2. Now a days families and new household creations with children are a far cry from even 30 years ago.
Then some of us Americans dont want to work hard. Then some don’t want to do what they think is dirty work.
I have a client that owns a cleaning franchise. Maga to the top. Even he now says David just get these people coming in a work visa because I cant find or keep employees.
The factory jobs are 80% or more gone at least in the Northeast. The only commercial real estate I see being built is medical suites. Anything in the medical profession seems to be the only profession with job growth.
Another big issue is how high school and colleges are not teaching the skills necessary for the available good paying jobs.
Apparently a liberal college education with a degree in Humanities and a triple minor in journalism, “free Palestine” and womens vagina studies doesn’t translate to a marketable skill set for employment
Who would have thought?
lol, my son found out he loved welding in high school here in Pittsburgh. Starting to think going trades instead of a degree in business.
Kinda’ siding with him as I’ve good friends who can help him with the unions, certs, and an apprenticeship .
Perfect. Its what this country needs. A waitress at my local diner has her son in electrical union apprentice program. Kid will be fine
Always a shortage of welders in the Northeast. Hell there is a shortage of every trade in the Northeast. Every contractor I have had to use in the last 20 years has said that every year.
My local community college has a program for Airplane mechanics, pilot training, air controller.
We need so much more of this.
and I should have added do both.
There are health issues associated with dirty jobs. Factory areas have been associated with dementia, Alzheimer’s disease and even Parkinson. as well as cancer, and lung problems. I grew up near your home and wouldn’t consider jobs that involve pollution.
And meant to add while yes todays report shows medical jobs decreasing, over the last 5 years its been a growing sector and a job that gets you good & inexpensive health insurance and a defined benefit pension plan in most cases. I have a dozen clients or friends kids I can bare witness too, including my son.
I would imagine it’s something to do with the Epstein files STILL not released, or Russia STILL invading Ukraine. Can’t have a Golden Age with all that going on.
On the bright side, Dear Leader looks like he has one foot in the grave. He’ll be screaming in hell by the end of the year, most likely, and Vance will be molesting couches in the Oval Office.
What have you got against Vance? A new comer to all this lets give him a chance when he gets his opportunity.
We have Jewish Derangement Sydrome(JDS) TDS, self explanatory, PDS or Putin Derangement Sydrome and now we have Vance Derangement Sydrome? VDS??
Well, he goes from:
““I go back and forth between thinking Trump is a cynical asshole like Nixon who wouldn’t be that bad (and might even prove useful) or that he’s America’s Hitler. How’s that for discouraging?” Vance concludes, before asking McLaurin how his work was going.”
… to full on orang ass kisser as soon as Peter Thiel stuffed a bunch of cash in his pockets.
In short: Vance is a lying opportunistic creep, just like all the other clowns that take turns singing Cheeto Pedo’s praises at the beginning of each cabinet meeting.
Stupid representation, for stupid people.