14

Early Results from JOLTS

Monthly Labor Review November 2004

Kelly A. Clark

Early Results from JOLTS

The Job Openings and Labor Turnover

Survey: what initial data show

Early results from these new data series show

trends that are in line with other surveys,

both private industry and government,

and allow for a more complete picture of the labor market

Kelly A. Clark is an

economist in the

Division of Administrative Statistics and

Labor Turnover, Bureau

of Labor Statistics.

E-mail:

JOLTSinfo@bls.gov

Data on job openings and labor turnover

are useful in understanding the U.S.

labor market, the business cycle, and

the economy in general. The Bureau of Labor

Statistics (BLS) began publishing such estimates

in July 2002. These data include a measure of

unmet labor demand, which complements the

broadest measure of excess labor supply, the

unemployment rate, and yields a more complete picture of the labor market. Hires and

separations, measures of labor turnover, track

labor market movements over the course of the

business cycle and allow individual businesses

to compare their own turnover rates with the

national rates.

This article provides an overview of the estimates from the Job Openings and Labor Turnover Survey (JOLTS).1

 It briefly describes the

JOLTS program, highlights what job openings

and labor turnover data reveal about the labor

market and the economy, and compares and

contrasts the JOLTS series with other comparable

data series to understand and, in part, validate

movements in the JOLTS data. Ongoing and future uses for these valuable new data series are

also discussed.

The JOLTS program

BLS has collected both job openings and turnover information in several different surveys

during the past 50 years. However, these surveys were short-lived due to budget cuts, and

the scope was limited to certain industries or

States. The current JOLTS program began in

1999 as a comprehensive survey of job openings, hires, and separations at a time when new

data were needed to allow further analysis into

the U.S. labor market and movements in the

economy. 2

JOLTS collects monthly job openings, hires,

and separations data from a nationally representative sample of 16,000 private and public

business establishments. Job openings are

collected as of the last business day of the

month, serving as a snapshot of unmet labor

demand for the month. Hires and separations

are collected for the entire month and measure

the flow of labor during the month. Total

separations are the sum of three components:

quits (or voluntary separations); layoffs and

discharges (involuntary separations); and other

separations resulting from retirements, deaths,

and disability.

The job openings rate is designed to complement the unemployment rate. There are three

conditions for an opening to be reported in

JOLTS, just as there are three conditions for a

person to be considered unemployed. To be

considered a job opening, a job must be currently available, work for the job could start

within 30 days, and an employer must be actively recruiting to find someone to fill the job.

To be considered unemployed, a person must
Monthly Labor Review November 2004 15

Vacancy

rate

Expansion

UL, VH

Contraction

UH, VL

Unemployment

rate

Movements along the curve are generally related to

changes in the business cycle and the cyclical fluctuations of

the demand for labor. Shifts of the curve are due to changes

Movement along the Beveridge curve

A shift in the Beveridge curve

be available for work, could start work immediately, and must

be actively searching for work.

JOLTS estimates were first released in July 2002, and

monthly estimates are available beginning with December

2000. In addition to the national totals, seasonally unadjusted

estimates are published for the private and public sectors, for

16 private industry divisions, and for 2 public industry divisions based on the North American Industry Classification

System (NAICS). Estimates for four geographic regions also

are available. Seasonally adjusted estimates are available

for job openings, hires, total separations, and quits at the total nonfarm level as well as for the regions and selected industry sectors.3

 Neither layoffs and discharges nor other

separations showed a strong seasonal component, but these

data series, as well as the remaining unadjusted industry series, will be re-evaluated periodically to determine if and

when seasonal adjustment is possible.

The JOLTS data series were first published as developmental because the estimates from the new program were subject

to intense scrutiny and review, and BLS needed time to conduct a thorough methodological review before announcing

the series as official BLS labor market statistics. In addition,

the entire sample of establishments was not enrolled in the

survey until January 2002, and collection methods were refined in March 2002 to help respondents more accurately

report separations data.

In April 2004, the developmental status was lifted, and

seasonally adjusted data series were first released along with

monthly press releases, which provided some analysis of the

estimates. Also, the production process was altered to allow

preliminary, or first closing, estimates to be released; previously, final, or second closing, estimates had been released.

Even throughout the period when the series were classified

as developmental, the individual series showed movements

that were in line with other economic indicators and with the

cyclical movement of the economy. Although BLS advises

caution when using estimates prior to March 2002, those estimates are useful in evaluating the state of both the labor

market and economy in general during the recessionary period and the beginning of the recovery.

Labor demand and the Beveridge curve

Statistics on job openings are a necessary complement to the

BLS unemployment data for a complete picture of the labor

market; job openings data represent unmet labor demand and

unemployment data represent excess labor supply. The parallel concept of these two data sources allows direct comparisons. In theory, job openings should move in the opposite direction of unemployment over the course of the business cycle. In good economic times, the labor market tends

to be tight, with employers searching for employees, but most

people who want a job already are employed. Unemployment tends to be low and openings tend to be high. However, when economic conditions worsen, employers are hesitant to post openings for “new” jobs, and the few openings

for existing jobs tend to be filled quickly. Unemployment is

usually higher due to reduced hiring and increased layoffs in

response to weak demand.

The Beveridge curve is the depiction of the relationship

between job openings and unemployment over time, shown

as an inverse relationship between the two rates, with movements along the curve distinguished from shifts of the curve

itself. (See illustrations below.)

Vacancy

rate

Reduced

matching

efficiency

Improved

matching

efficiency

Unemployment

rate
16

Early Results from JOLTS

Monthly Labor Review November 2004

in the efficiency with which workers match with open jobs.

These movements are based on changes in structural and frictional unemployment as the labor force changes and as industry and geographic trends influence the distribution of jobs.

As matching efficiency changes, the curve moves closer to or

further away from the origin. Even though the two movements

are not independent, it is possible to distinguish them when

graphing the Beveridge curve over long periods of time.4

Although the JOLTS job openings series is rather short, a

preliminary look at the Beveridge curve shows the expected

inverse relationship between the job openings and unemployment rates. (See chart 1.) The correlation between the two

series, at –0.80, is negative and significant, as expected. The

chart shows that early 2001 was a period of low unemployment and high job openings. As the economy moved into

recession, unemployment increased and job openings decreased. In the post-recessionary period, unemployment

dropped slightly while job openings increased slightly. It

appears as though there have been only movements along the

curve (indicating changes in labor demand), rather than significant shifts in the curve (indicating changes in the efficiency with which open jobs match with workers), but a

longer time series will be able to better distinguish the movements and yield more insight into the labor market changes

during this period.

The short time series also does not allow much analysis of

the job openings rate prior to the start of the 2001 recession.

Research has predicted job openings lead at business cycle

peaks and lag at troughs. When sensing an economic downturn, employers generally first reduce job openings and hires

before separating current employees, and as conditions improve, it is less costly to recall workers from layoffs than to

begin recruiting and training new employees. The National

Bureau of Economic Research (NBER) dated the most recent

recession as having started in March 2001, and with the job

openings series beginning in December 2000, it is impossible to determine the number of months that the job openings rate dropped before the official start of the recession.

However, NBER declared the recession over in November

2001, and it appears that job openings did not rebound

strongly in 2002 or 2003, indicating lagging at the business

cycle trough. Chart 1 shows that the Beveridge curve may

be looping back along itself in 2004, showing that job openings have begun to increase as unemployment has decreased.

Job openings and unemployment levels

When examining the unemployment and job openings estiChart 1. The Beveridge Curve, seasonally adjusted

Job

openings

 rate

3 .6 4 4 .4 4 .8 5.2 5.6 6 6 .4

1.8

2

2.2

2.4

2.6

2.8

3

3.2

3.4

1.8

2

2.2

2.4

2.6

2.8

3

3.2

3.4

Job

 openings

rate

Unemployment rate

Dec. 2000

Aug. 2001

Oct. 2002

June 2003

Mar. 2003

June 2004

3.2

3 .4

2.8

2.6

2.4

2.2

2. 0

1.8

3.0

3.2

3 .4

2.8

2.6

2.4

2.2

2. 0

1.8

3.0

3.6 4.0 4.4 4.8 5.2 5.6 6.0 6.4
Monthly Labor Review November 2004 17

mates, it is easy to see that the two series are at different

levels, and another way to analyze the data series is to compare the two levels over time. Long before the United States

had a representative survey such as JOLTS to collect job openings data, Katharine Abraham suggested that the number of

persons unemployed is much larger than the number of job

openings. 5 Her research showed the number of unemployed

persons was indeed greater than the number of job openings

at any given time, but the ratio did shift over time. In the

mid-1960s, the ratio of unemployed persons to one job opening was approximately 2.5, which shifted to 4.0 in the early

1970s and then increased to 5.0 in the late 1970s. These

ratios can be used in determining the “tightness” of the labor

market. The ratio using the JOLTS job openings data ranges

from below 2.0 unemployed persons for every job opening

throughout the first half of 2001, when the labor market was

perceived as being relatively tight, to 3.3 in August 2003,

when the labor market was seen as lagging the general economic recovery.

Because of these types of direct comparisons, there already has been talk of a “jobs deficit,” or the difference between the number of unemployed persons and the number of

job openings.6

 It is important to remember that even with

carefully constructed parallel definitions, the reference periods are both snapshots, but different: the week of the 12th

for unemployment, compared with the last business day of

the month for job openings. Job openings that first become

open and are filled at any time before the end of the month

are not included in the job openings estimates. In addition,

the JOLTS definition of a job opening requires that a job be

unfilled to be counted. Experience suggests that some companies post openings and fill jobs while the departing employee is still working, in order to train the new employee,

and these openings would not be included in the JOLTS estimate. Another requirement for a job opening to be counted

is that work could begin within 30 days. For industries such

as education that tend to fill jobs well in advance of when

work will actually begin (posting jobs and hiring in the spring

for work to begin when school opens in the fall), these openings will not be reflected in the JOLTS estimate. Furthermore,

the survey that measures unemployment, the Current Population Survey (CPS), has a different scope than the JOLTS program. The CPS is a household survey that includes agricultural workers, unpaid family workers, domestic workers in

private households, and the self-employed, all of whom are

not covered by establishment surveys such as JOLTS. It is

therefore better to compare the ratio of unemployed to job

openings over time rather than focusing on how the levels

compare at any one point in time.

In addition, Abraham was careful to note that it is not necessarily optimal for there to be a one-for-one relationship

between unemployment and job openings.7

 There are social

costs involved with unemployment (for instance, a 10-percent unemployment rate would not be considered optimal,

even with a 10-percent job openings rate), and even if there

were a one-for-one relationship at a point in time, the people

looking for work may not meet the qualifications needed to

fill the job openings, or the job openings may not be in the

same location as the people looking for work. These frictions in the labor market (the source of frictional unemployment) keep job openings from being filled instantaneously.

Job openings and the Help-Wanted Index

From the beginning, the JOLTS program has tracked each data

series against other available series to help analyze the validity of both long-term trends and month-to-month movements.

The only other existing national measure of excess labor demand is the Conference Board’s Help-Wanted Advertising

Index (Help-Wanted Index).8

 With some manipulation, the

Help-Wanted Index has been used in Beveridge curve analysis in the past. As a measure of the volume of help-wanted

advertising in major newspapers from across the country, this

index has been a good indicator when compared with unemployment. The job openings rate and the Help-Wanted Index, have trends that are roughly similar. (See chart 2.) However, the decrease from December 2000 to November 2001

was much sharper for the Help-Wanted Index, which experienced a drop of 42 percent, compared with a drop of 30 percent in the job openings rate. The differences in scope and

definition between the Help-Wanted Index and the job openings rate may account for some of this difference. A change

in the way employers advertise open positions also may help

to explain; for example, if a large number of employers

stopped posting advertisements in the newspaper in favor of

advertising on one of the many Internet sites, the decline in

the Help-Wanted Index would not represent an economic

movement. In addition, JOLTS estimates from December 2000

through 2001 had larger measures of error than the 2002 and

later estimates.

Employers who place help-wanted advertisements in

newspapers may not be representative of the national

economy, as ads tend to vary by skill level, education level,

and job type. Also, the growth of the Internet’s popularity

for job postings may have affected the number of newspaper

advertisements in the long run. The Conference Board has

investigated ways to take account of advertising on the

Internet, but has not made any adjustments to the HelpWanted Index.

The various job search sites on the Internet are new options for employers seeking workers, but no single site is

comprehensive enough to be used as an indicator of labor

demand. Issues of coverage, scope, the existence of multiple

positions per ad, and fees for postings are obstacles in using
18

Early Results from JOLTS

Monthly Labor Review November 2004

these sites as indicators.

The Help-Wanted Index is not adjusted to account for

multiple positions per ad, and there are no limitations on the

types of ads placed in newspapers, some of which may be

placed to gather resumes for future hiring. Neither JOLTS nor

the Help-Wanted Index differentiates between full- or parttime openings, and neither includes occupational information or a measure of “good” jobs versus “bad” jobs or for

low-wage versus high-wage positions. As the JOLTS program

expands, questions related to these issues may be added to

the survey.

Labor turnover and the business cycle

Thus far, the job openings data series has confirmed much of

what previous research has suggested. However, some observers have been surprised by what the JOLTS hires and separations data series show, especially the amount of churning

in the labor market each month. Net employment changes

tend to be small from month to month, but there are millions

of hires and millions of separations occurring each month at

U.S. businesses. During the past decade, the annual employment change has averaged approximately plus or minus 2.2

million, but nearly 50 million hires and 50 million separations occur during any 12-month period in the past 3 years.

These numbers dwarf the annual net employment change and

help show the dynamism of the labor market. Information

about labor market flows can therefore shed more light on

how the economy works.

Hires and separations estimates can be used along with

other economic indicators in examining movements in the

business cycle. Hires are procyclical, increasing when the

economy strengthens and decreasing when the economy

weakens. In examining employment and the hires rate, there

is a significant correlation between the two series. This indicates that employers tend to control their employment level

by altering their hiring patterns, as there are significant costs

associated with separations.9 When economic times are good,

employers hire to replace employees who have separated and

may hire for newly created jobs. During recessions, employers may hold back on hiring to replace separated workers

until business conditions improve, rather than increase separations overall. There is a close trend movement between

the unadjusted series of employment and the hires rate and

the related movement of the quits rate, the largest part of

total separations. (See chart 3.) In fact, the correlations between hires and employment and quits and employment are

positive and significant.10 As quits tend to behave

Chart 2. The Help-Wanted Index, unemployment rate, and job openings rate, seasonally adjusted

Unemployment and

job openings rates

HelpWanted

Index

Help-Wanted Index

Job openings rate

Unemployment rate

NOTE: Shaded area denotes recession.

2000 2001 2002 2003 2004

D ec. M ar. Jun. S ep. D ec. M ar. Jun. S ep. D ec. M ar. Jun. S ep. D ec. M ar. Jun.

1

2

3

4

5

6

7

3 0

4 0

5 0

6 0

7 0

8 0

9 0

1

2

3

4

5

6

7

30

40

50

60

70

80

90

Dec. Mar. Jun. Sept. Dec. Mar. Jun. Sept. Dec. Mar. Jun. Sept. Dec. Mar. Jun.
Monthly Labor Review November 2004 19

procyclically, increasing when the economy is strong (and

thus as employment increases), the correlation with employment is positive.

The movement of the separations rate is dominated by

quits. In fact, quits have ranged from 51.3 percent of total

separations in June 2003 to more than 60 percent in early

2001 and have averaged 54.7 percent over the course of the

published data series. This is an important fact in examining

how separations data move with the business cycle. Intuitively, separations would seem to be countercyclical; as economic conditions deteriorate, employers lay off workers.

However, because of the dominance of quits among the three

components of total separations, separations have behaved

procyclically. Total separations have decreased during the

current recessionary period, largely because of the decrease

in quits over that period and despite the uptick in layoffs and

discharges. (See chart 4.)

Layoffs and discharges did increase during the recession,

especially from June to October 2001, but perhaps not as

much as media reports would indicate. Often, companies

report a target number of “layoffs,” but some companies may

actually decrease their workforce through attrition and by

decreased hiring during worsening economic conditions.

Other companies may lay off workers in their factories overseas before cutting jobs at U.S. plants. In other cases, planned

layoffs never materialize.

The other separations rate, which includes retirements,

deaths, separations due to disability, and transfers to other

locations of an establishment, has remained relatively stable

over the course of the published series, fluctuating between

0.2 percent and 0.3 percent. A large proportion of other separations is thought to be retirements, and thus the demographic

shift in the composition of the labor force may affect the other

separations rate in coming years. As the baby-boom generation moves into retirement years, the result may be an increase in the other separations rate over time.

Turnover estimates and other economic indicators

As stated earlier, quits tend to decrease during recessions

because workers’ outlook toward finding another job worsens with deteriorating economic conditions. 11 As economic

conditions worsened throughout 2001 and 2002, consumer

confidence plunged, and fewer people quit their jobs than at

the same time the prior year. (See chart 5.) The seasonally

adjusted quits series shows a decrease throughout the published series, and the consumer confidence index exhibits the

same downward trend as the quits rate over the course of the

Chart 3. Employment, hires, and quits, not seasonally adjusted

Hires and quits

(in thousands)

Employment

(in thousands)

Quits

Hires

Employment

NOTE: Shaded area denotes recession.

2000 2001 2002 2003 2004

D ec. M ar. Jun. S ep. D ec. M ar. Jun. S ep. D ec. M ar. Jun. S ep. D ec. M ar. Jun.

1 ,0 0 0

2 ,0 0 0

3 ,0 0 0

4 ,0 0 0

5 ,0 0 0

6 ,0 0 0

7 ,0 0 0

8 ,0 0 0

124,000

125,000

126,000

127,000

128,000

129,000

130,000

131,000

132,000

133,000

134,000

Dec. Mar. Jun. Sept. Dec. Mar. Jun. Sept. Dec. Mar. Jun. Sept. Dec. Mar. Jun.

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

124,000

125,000

126,000

127,000

128,000

129,000

130,000

131,000

132,000

133,000

134,000
20

Early Results from JOLTS

Monthly Labor Review November 2004

Chart 5. The Consumer Confidence Index and the quits rate, seasonally adjusted

Quits rate

Consumer Confidence

Index

Quits rate

NOTE: Shaded area denotes recession.

2000 2001 2002 2003 2004

Consumer

Confidence

Index

D ec. M ar. Jun. S ep. D ec. M ar. Jun. S ep. D ec. M ar. Jun. S ep. D ec. M ar. Jun.

1

1 .2

1 .4

1 .6

1 .8

2

2 .2

3 0

4 5

6 0

7 5

9 0

105

120

135

150

1.0

2.0

Dec. Mar. Jun. Sept. Dec. Mar. Jun. Sept. Dec. Mar. Jun. Sept. Dec. Mar. Jun.

30

45

60

75

90

105

120

135

150

1.0

1.2

1.4

1.6

1.8

2.0

2.2

Chart 4. Breakouts of total separations, seasonally adjusted

Percent

Rate of all other separations

Quits rate

NOTE: Shaded area denotes recession. The “all other separations” series is derived by subtracting quits from total separations.

The layoffs and discharges and other separations series are not seasonally adjusted.

2000 2001 2002 2003 2004

D ec. M ar. Ju n. S ep. D ec. M ar. Jun. S ep. D ec. M ar. Jun. S ep. D ec. M ar. Jun .

1

1 .2

1 .4

1 .6

1 .8

2

2 .2

1

1 .2

1 .4

1 .6

1 .8

2

2 .2

Percent

1.0

2.0

1.0

1.2

1.4

1.6

1.8

2.0

2.2

1.0

1.2

1.4

1.6

1.8

2.0

2.2

Dec. Mar. Jun. Sept. Dec. Mar. Jun. Sept. Dec. Mar. Jun. Sept. Dec. Mar. Jun.
Monthly Labor Review November 2004 21

series. The consumer confidence series shows something of

a rebound in late 2003 and early 2004, perhaps signaling that

quits may be expected to increase even further in late 2004.

The correlation of quits and consumer confidence is 0.80,

which is positive and significant.

One of the only other data series providing a national turnover rate has been the Bureau of National Affairs (BNA) quarterly Job Absence and Turnover report.12 This long-running

series provides results from approximately 300 U.S. member

companies surveyed. The JOLTS total separations data trend

with the BNA turnover series, but at a higher level partly because BNA does not include layoffs, job eliminations, or departures of temporary staff, whereas JOLTS includes all types

of separation during the reference month. (See chart 6.)

Although the BNA report provides a long time series for

turnover estimates, the JOLTS program provides a timely and

nationally representative indicator of turnover for both hires

and separations. In addition, with a much larger sample size

and a more inclusive definition of turnover, the JOLTS statistics are more reliable and useful. With the larger sample size,

JOLTS is able to publish more industry detail. However, the

BNA report publishes turnover rates by establishment size

class, which JOLTS may pursue in the future because turnover

rates appear to vary by establishment size.

In mid-2003, BLS once again added to the national statistical framework with data series showing what underlies net

employment changes, the Business Employment Dynamics

(BED).13 Quarterly statistics on gross job gains and gross job

losses also prove an interesting comparison to hires and separations flows. (See chart 7.) These series track net employment changes at the establishment level. A preliminary analysis has shown JOLTS total private hires and separations,

summed for each quarter, have outpaced the gross job gains

and gross job losses, which is as expected. The gross job

gains and gross job losses are computed by comparing the

employment level of the third month of each quarter. JOLTS

measures each individual hire and separation that occurs during every month, and thus the data series are, by definition,

higher than the gross job gains and losses series. For example, if an establishment’s employment level was 10 in the

third month of the first quarter and 10 in the third month of

the second quarter, there would be no employment change

and thus no effect on the gross job gains or losses. However,

there may have been three hires and three separations in between those two points, which JOLTS data would reflect.

Along with JOLTS, the Business Employment Dynamics statistics on gross job gains and gross job losses are additional

tools to use in labor market analysis. The JOLTS data series

will continue to be tracked against all of these data series

over time. As with job openings, the JOLTS series of hires and

D ec. M ar. Jun . S ep. D ec. M a r. Jun. S ep. D ec. M ar. Jun . S ep. D ec. M ar. Jun.

0

0 .5

1

1 .5

2

2 .5

3

3 .5

4

0

0 .5

1

1 .5

2

2 .5

3

3 .5

4

Percent

Chart 6. Bureau of National Affairs (BNA) turnover and total separations rates, seasonally adjusted

BNA turnover rate

Total separations rate

NOTE: Shaded area denotes recession.

2000 2001 2002 2003 2004

Percent

. 5

4.0

3.5

3.0

2.5

2.0

1.5

1.0

.5

4.0

3.5

3.0

2.5

2.0

1.5

1.0

.5

Dec. Mar. Jun. Sept. Dec. Mar. Jun. Sept. Dec. Mar. Jun. Sept. Dec. Mar. Jun.

0 0
22

Early Results from JOLTS

Monthly Labor Review November 2004

separations are more comprehensive and statistically reliable

measures than other series currently available. However,

because the data are collected from businesses, it is not possible to track employment flows of individuals. For example,

if a person quits, there is no way of telling if they quit to

move into another job, become unemployed, or leave the labor force. Surveys that track labor force flows over time,

such as the BLS National Longitudinal Survey or the gross

flows statistics from the BLS Current Population Survey, are

more appropriate for those types of analysis. Combining

these indicators with JOLTS statistics allows a more complete

picture of the labor market for study and analysis.

Future uses of JOLTS estimates

Although the JOLTS program was designed to provide national

economic indicators, there are several things the estimates

do not provide. There is a demand for job openings by occupation and establishment size class, duration of vacancies,

and openings at the State and metropolitan area level. Some

industry or occupational associations have estimates of job

openings, and several States are conducting a job vacancy

survey, but there is no single comprehensive and statistically

reliable source for this type of information. The JOLTS program is currently investigating the feasibility of developing

estimates by establishment size class and estimates for the

total metropolitan and nonmetropolitan areas.

Another future use for JOLTS estimates concerns analysis

of wages. Using data serving as a proxy for job openings,

researchers have found that job openings may be a better

indicator of wage inflation than is unemployment.14 This

certainly should be an area for research once the JOLTS job

openings series develops further. Econometric analysis involving wages (with data from the BLS Current Employment

Statistics program), unemployment, and job openings, including other factors, will be required to investigate the

strength and validity of the relationships.

The job matching function has been of interest to researchers for several years, and wages also play a role in this analysis. The matching function relates the flow of new matches

(hires) to the number of jobseekers (unemployed persons)

and job openings. The results of job matching are easily

observable from month-to-month changes in the job openings and unemployment data, but how jobseekers and employers with open jobs actually find each other is quite complicated. Factors such as wages, as well as external factors

such as demographics, educational structure, and geographic

concentration of industries all influence how open jobs and

In thousands

Chart 7. Quarterly Business Employment Dynamics gross job gains and losses and hires and total

separations, seasonally adjusted

Gross job losses

Total separations

NOTE: Shaded area denotes recession.

2001 2002 2003 2004

In thousands

I II III IV I II III IV I II III IV I II

6 ,0 0 0

7 ,0 0 0

8 ,0 0 0

9 ,0 0 0

1 0 ,0 0 0

1 1 ,0 0 0

1 2 ,0 0 0

1 3 ,0 0 0

1 4 ,0 0 0

6 ,0 0 0

7 ,0 0 0

8 ,0 0 0

9 ,0 0 0

1 0 ,0 0 0

1 1 ,0 0 0

1 2 ,0 0 0

1 3 ,0 0 0

1 4 ,0 0 0

Hires

Gross job gains

6,000

7,000

8,000

9,000

10,000

11,000

12,000

13,000

14,000

6,000

7,000

8,000

9,000

10,000

11,000

12,000

13,000

14,000

I III IV II III IV I III IV II I II II I
Monthly Labor Review November 2004 23

jobseekers are matched.15 As proxies of job openings had

been used in previous studies, analysis using the JOLTS job

openings data will help further this area of research.

It is apparent that there is a long list of research topics that

job openings and turnover data can be used to investigate.

Alone or in combination with other national economic indicators, the new JOLTS data series already have yielded valuable information about the U.S. labor market and economy

in general. The estimates have shown similar trends as other

national economic series, and they will continue to be tracked

over time as a validation exercise and as a research and analysis tool.

1 Job openings and labor turnover data, along with a brief analysis, are

released monthly in a press release, on the Internet at: http://www.bls.gov/

jlt/. Selected data also appear in the Current Labor Statistics department

of this publication each month.

2

 For additional information about the development of the program,

see Kelly Clark and Rosemary Hyson, “New tools for labor market analysis: the Job Openings and Labor Turnover Survey,” Monthly Labor Review, December 2001, pp. 32–37.

3

 Natural resources and mining, information, financial activities, and

other services did not show strong seasonal patterns when seasonal adjustment diagnostics were first evaluated.

4

 See Katharine G. Abraham, “Help-Wanted Advertising, Job Vacancies, and Unemployment,” Brookings Papers on Economic Activity, no.

1, June 1987, pp. 207–48; and Hoyt Bleakley and Jeffrey C. Fuhrer, “Shifts

in the Beveridge Curve, Job Matching, and Labor Market Dynamics,”

New England Economic Review, September/October 1997, pp. 3–19.

5

 See Katharine G. Abraham, “Structural/Frictional vs. Deficient Demand Unemployment: Some New Evidence,” American Economic Review,

1983, vol. 73(4), pp. 708–24.

6

 See Economic Snapshots, The Economic Policy Institute, Oct. 2, 2002.

7 See Abraham, “Structural/Frictional,” p. 708–24.

8 For additional information about the Help-Wanted Advertising Index, see The Conference Board’s website at www.conference-board.org

9

 See Daniel S. Hamermesh, Wolter H.J. Hassink, and Jan C. van Ours,

“Job Turnover and Labor Turnover: A Taxonomy of Employment Dynamics,” Annales D’Economie et de Statistique, no. 41/42, 1996, pp. 21–40,

for their work concerning Dutch establishments; and John M. Abowd,

Patrick Corbel, and Francis Kramarz, “The Entry and Exit of Workers and

the Growth of Employment: An Analysis of French Establishments,” The

Review of Economics and Statistics, 81(2), May 1999, pp. 170–87, for

their work concerning French establishments.

10 The correlation coefficient for hires and employment is 0.51 and for

quits and employment is 0.44; both are significant at the 95 percent confidence level.

11 See Hoyt Bleakley, Ann E. Ferris, and Jeffrey C. Fuhrer, “New Data

on Worker Flows During Business Cycles,” New England Economic Review, July/August 1999, pp. 49–76 and Patricia M. Anderson and Bruce

D. Meyer, “The Extent and Consequences of Job Turnover,” Brookings

Papers: Microeconomics, 1994, pp. 177–248.

12 For additional information about the Job Absence and Turnover

Report, please see the Bureau of National Affairs’ website at www.bna.com

13 For additional information about the business employment dynamics,

see James R. Spletzer, R. Jason Faberman, Akbar Sadeghi, David M. Talan,

and Richard L. Clayton, “Business employment dynamics: new data on gross

job gains and losses,” Monthly Labor Review, April 2004, pp. 29–42.

14 See Katharine G. Abraham and James L. Medoff, “Unemployment,

Unsatisfied Demand for Labor, and Compensation Growth in the United

States, 1956–1980,” National Bureau of Economic Research Working Paper

Series, no. 781, October 1981.

15 See Barbara Petrongolo and Christopher A. Pissarides, “Looking

into the Black Box: A Survey of the Matching Function,” Journal of Economic Literature, June 2001, pp. 390–431.

Notes