South By North Strategies, Ltd.

January Job Openings

The latest version of the  Job Openings and Labor Turnover Surveyconducted by the U.S. Bureau of Labor Statistics found that job openings remained scarce in January, the most recent month for which data are available. As the Economic Policy Institute noted in its analysis of the data:

This morning, the Bureau of Labor Statistics released the January report from the Job Openings and Labor Turnover Survey (JOLTS), showing that job openings increased by 193,000 to 2.7 million in January (including an upward revision of 34,000 to earlier data).  From the Current Population Survey, we know that the number of unemployed workers decreased in January by 430,000 to 14.8 million.  This means there was substantial improvement in the ratio of job seekers per job opening, which dropped from 6.0 in December to 5.4 in January.  As the figure shows, there is a good deal of month-to-month volatility in this ratio, but nevertheless January marked the largest one-month improvement in the history of the series.  At 5.4, the number of unemployed workers per job opening is the lowest it has been since March of last year.   However, it remains almost twice as high as the worst month of the recession of the early 2000s, when it peaked at 2.8.

Editor’s Note

Policy Points will be updated on a reduced schedule during the week of March 15, 2010. Please check periodically for updates.

A Growing Jobs Gap

From the Economic Policy Institute’s analysis of the national jobs report for February …

Since the start of the recession in December 2007, the labor market has shed 8.4 million payroll jobs.  This number, however, understates the size of the gap in the labor market by failing to take into account continuing population growth: the labor market should have added around 2.7 million jobs since December 2007 to accommodate this growth.  This means the labor market is now roughly 11.1 million jobs below what would be needed to restore the pre-recession unemployment rate.  In order to fully fill in this 11.1 million job gap in the labor market in the next three years (by February 2013), employment would have to increase by 415,000 jobs every month between now and then.
…
And even the 11.1 million jobs gap understates the slack in the labor market because it fails to take into account the decline in hours worked for those who have kept their jobs. At the start of the recession in December 2007, the length of the average workweek in the private sector was 34.7 hours.  In February, it was 33.8 hours.  The decline in the total number of hours worked in the private sector since the start of the recession attributable to reduced hours alone (i.e., not job loss) is equivalent to 2.8 million jobs.  This means that the “effective” gap in the labor market is on the order of 13.9 million jobs (11.1 million plus 2.8 million).

Regaining Jobs in North Carolina

A recent article in the Triangle Business Journal asked how long it might take for North Carolina’s labor market to recover from the recession. The consensus opinion: a long time.

To help illustrate that point, the article featured data compiled by South by North Strategies, Ltd.

Following two previous recessions, the jobs bounce back was both quicker and stronger. According to data supplied by Chapel Hill-based South by North Strategies, after hitting bottom in the downturn of 1991, the state recovered to pre-recession levels in just 13 months by adding 6,800 jobs a month. From the trough of 2001 slowdown, recovery took 28 months with employment growing by 6,500 jobs a month.

Editor’s Note

Policy Points will be updated on a reduced schedule during the week of March 8, 2010. Please check periodically for updates.