- by New Deal democrat
The second of this morning’s reports was the JOLTS survey for November.
Like many other statistics concerning jobs, the JOLTS series have been deceleration for several years. The question now is whether they level off or continue to decelerate towards outright declines in net job creation. Additionally, it is a slight leading indicator for both initial jobless claims and unemployment; and for wage growth as well.
In contrast to the economically weighted ISM reports I discussed earlier this morning, in November as has so often been the case in 2024, the JOLTS data was mixed, with a downward bias. The soft statistic of job openings rose to a five month high, but the hard data of hires, quits, and also layoffs and discharges declined. The below graph norms the series above (expect for quits) to 100 as of just before the pandemic:
Both actual hires, as well as quits, turned weaker than their pre-pandemic levels a little about one year ago, while openings remain higher. The trend in openings has been lower, and I suspect that the improvement in the past two months is likely to prove to be just noise.
Showing the same data as YoY% changes tells us that there has been no significant change in the decelerating trend; in other words, there remains no evidence that there has been any leveling off:
The news on layoffs and discharges was also not so good. That’s because, in addition to rising in November, October’s very good number was revised significantly higher. This suggests that the YoY increases in initial jobless claims that we have seen during December have not been a fluke, and are more likely than not to continue:
Finally, although I’ll spare you the graph this month, the quits rate (blue in the graph below) has a record of being a leading indicator for YoY wage gains (red). In the post-pandemic view, the quits rate stabilized earlier in 2024 before resuming its decline, and in November it tied September for its post-pandemic low:
This suggests that on a YoY basis wage gains will continue to decelerate as well. If inflation stabilizes or picks up again, this could create a problem later this year - and if the overall trend of the JOLTS data continues, so will it.
