Yesterday, the JOLTS report from the BLS showed that there were 11.3 million job openings in May, down from a revised 11.6 million in April, and layoffs were little changed from their record low of 1.4 million.
The most important thing this showed us is that there is no sign of a recession in this data. Not much has changed, but that’s largely good news for a strong labor market.
As we can see, Professional and Business Services saw a huge decline in the number of openings available, but I would say this mostly reflects a normalization in hiring rather than any signal of a recession.
The stock market, consumer confidence, and news of layoffs at high-profile companies like Tesla have all contributed to a sense that the economy is headed for trouble, but when we look at these numbers, we see that workers are still quitting at high rates and that shows they’re very confident in their ability to get another job. And as long as people changing jobs continue to see significant pay growth and layoffs stay low, it’s difficult to see how quits will come down.
On Friday, when the June employment situation report comes out, we’ll know a lot more about where the market is and where it’s going—I’ll be keeping an eye on labor force participation especially, and whether it ticks up because of inflation.
Right after JOLTS came out yesterday, I joined my Lightcast colleagues Layla O’Kane and Chris Laney to discuss our key takeaways. Tomorrow on the Lightcast LinkedIn page, Senior Economists Rucha Vankudre and Ron Hetrick will be doing the same.
Across The Pond
This newsletter is coming to you from further away than Boston this week—I’m at the Lightcast UK office in Basingstoke to meet with our team there, a stopover on my way to a conference in Brussels—more on that next week.
As I’ve been here, I’ve been paying special attention to trends in the UK job market, and one that sticks out is the growth of the four-day workweek. This summer, thousands of workers here from over 60 employers are trying out a four-day week, and there are already signs that this has had a positive impact on morale and productivity.
Those signals could indicate that a four-day week may become permanent for many employers, and our data show that this has already begun. By searching “four-day” and “4-day” in the Lightcast database of job postings, we can see that postings mentioning those terms are up 1365% since the beginning of 2019.
This mirrors what we’ve also found in the US, where Lightcast data show four-day postings soared up 673% from 2018 to 2021.
Like so much of the world, the UK job market is staying tight, and employers are looking for ways to recruit and retain their workforce, and many are opting to promote three days off each week as a way of enticing talent.
In The Papers
At the National Bureau of Economic Research, researchers from Harvard, Georgetown, and the Federal Reserve of Philadelphia looked into how seniority correlated to later career outcomes. While most economic research focuses (naturally) on financial and quantitative measurements, this paper, “Failing Just Fine,” instead looks at how individuals with similar educations experience different career outcomes based on their job titles.
Their analysis used Lightcast data containing over five million resumes, which enabled the researchers to compare individuals’ degrees, graduation dates, employers, and the start and end dates at each of their positions. The researchers found that those senior enough to be considered founders (and backed by venture capital) significantly outperformed their peers who had similar educations and first jobs, and this was true even when the would-be founders failed in their enterprises.
Papers like this one show what’s possible when looking at data that goes deeper than just numbers, and highlights how all kinds of research can go further in exploring the world of work.
Until next week,
Lightcast Chief Economist
Welcome to the Letter from the Chief Economist.
At Lightcast, our mission is to unlock mobility and opportunity for every employee, student, and community around the world.
I lead a team of economists and data scientists who look every day at our billions of data points in order to find meaningful insights and human stories. We believe those insights and stories can drive change, and every week, I’ll be sharing some of the highlights from our research.