JOLTS: Openings Fall But Quit Rate Jumps

Bottom Line:  The Job Openings Layoffs and Turnover Survey showed sharply lower job openings in May, but there were upward revisions to previously reported openings. Lagged relative to most labor reports and our nowcast forecasts, the JOLTS survey is helpful in its detail and has often been cited by Fed officials in recent years. The quit rate has been a particular focus of Fed Chair Powell. And that edged surprisingly higher, a potential signal of continued tightness in the labor market after nearly a year of easing. Looking through the details, we saw continued robust hiring in health care even as openings in the sector moved lower. Leisure and hospitality, a source of much of the tightness in labor, continued to see hiring and openings trending lower. Overall, openings are structurally higher in this cycle (and probably much longer) relative to total employment. The trends suggest the historically tight labor market continues to slacken only slowly. And in the short term, the uptick in the quit rate is a hawkish omen for the Fed, especially Chair Powell.