The JOLTS Report -- June 12, 2021

From the Breitbart New Desk, the "Breitbart Business Digest":

The Job Openings and Labor Turnover Survey—or JOLTS—takes the prize for the most illuminating of the week's economic data. That's saying a lot for a week that included jobless claims falling to a new pandemic low, continuing claims falling below 4 million for the first time since the pandemic struck, and a Consumer Price Index with the highest core inflation since 1992, while the University of Michigan's Index of Consumer Sentiment showed inflation expectations declining. Joe Biden might be pretty dull, but the economic data of Bidenomics is riveting.

Economists had forecast businesses posting 8 million or so jobs in April, a slight decline from what was believed to be an unsustainably hot March figure of 8.2 million. This was a quite reasonable forecast, as 8.1 million was a record high in data going back to the turn of the century, topping even the extremely high levels seen at the peak of the strong Trump jobs market. Economic data tend to mean revert, after all.

Instead, March was revised up to nearly 8.3 million, meaning it broke its own record. And April came in at 9.3 million, a new record high. It wasn't just the level that was impressive but the pace. Never before had job postings ever risen by 1 million jobs. The closest it had come to that prior to this year was 808,000 in 2015. The median change is just an addition of 13,000 jobs.

The JOLTS report also shattered a relationship that is one of the mainstays of modern labor economics known as the Beveridge Curve. It tracks the relationship between job openings and the unemployment rate. The curve shows that, in general, the unemployment rate and job openings tend to move in opposite directions. When there are many job openings, unemployment falls. When there are few openings, unemployment rises. Yet in April, the unemployment rate ticked up to 6.1 percent from six percent in March—exactly the opposite of what the curve would predict.

In other words, we are in a highly unusual labor market. No doubt one of the sources of weirdness is the fact that enhanced unemployment benefits pay nearly twice the average weekly wage. That makes it hard to hire anyone on unemployment. But the gap between job openings and employment is so wide that it suggests something else is going on. Perhaps it is the expectation for guaranteed income, either in the form of "family allowances" or Silicon Valley's Universal Basic Income scheme. Perhaps some older people just decided to take a hint from the pandemic and retire early. Some young people may be hanging back from the workforce to enjoy a YOLO reopening summer. We'll know more once the enhanced UI runs out in September and we see whether the gap between openings and hires closes.

– Alex Marlow & John Carney
Breitbart News Network