The Bureau of Labor Statistics reported that net hiring in the manufacturing sector edged up a bit in September, but employment growth remains quite soft. The number of new manufacturing hires rose has improved from 222,000 in July to 256,000 in September. Over the same time frame, separations in the sector – which include layoffs, quits, and retirements – have increased from 238,000 to 249,000. As such, net hiring (or hires minus separations) has shifted from a decline of 16,000 workers in July to a gain of 7,000 new employees in September. While this is a definite improvement, it suggests very modest job gains overall, with a continuing hesitance within the sector to hire new workers.
Indeed, the number of job postings from manufacturers declined somewhat from 268,000 in August to 252,000 in September. This was still better than the 210,000 and 234,000 job openings recorded in June and July, respectively. The job postings rate in September was 2.1 percent of total manufacturing employment, down from 2.2 percent in August but up from 1.7 percent in June.
The longer-term trend with job openings is also instructive. Between January 2010 and March 2012, manufacturing job postings rose from 145,000 to 324,000. This was when manufacturers were making outsized gains to employment and growth, with the sector rebounding from a very severe recession. Since March 2012, however, prospective hiring has shifted lower, bottoming out at 210,000 in June, as noted above. For net hiring to improve dramatically, we would need to see job openings start to pick up significantly.
In the larger economy, total job openings expanded from 3,844,000 in August to 3,913,000 in September, boosted by growth in accommodation and food services, construction, professional and business services, and retail trade. At the same time, net hiring was up marginally from 154,000 in August to 159,000 in September. Hiring was mixed overall, with increases in leisure and hospitality, manufacturing, and professional and business services counterbalanced by declines in government, retail trade, and education and health services. Overall, though, the data were little changed from the previous month.
Chad Moutray is the chief economist, National Association of Manufacturers.