The Bureau of Labor Statistics said that manufacturing job openings declined for the fourth straight month. After peaking at 298,000 in November, the number of job postings in the sector has continued to move lower, with 243,000 openings recorded in March. Weather has negatively impacted overall economic activity over much of this period, and it is possible that winter conditions hampered employment growth, as well.
Nonetheless, we would expect that this trend will reverse in the coming months, particularly if the sector resumes the rebound that was occurring last fall. There had been upward movement in manufacturing job openings from May to November of last year (up from 203,000 to 298,000), for instance. The Job Openings and Labor Turnover Survey (JOLTS) have a bit of a time lag. Fortunately, we already know that manufacturers added 12,000 workers on net in April, providing us with some cautious optimism.
In the March data, net hiring had turned negative for the first time in eight months. Manufacturers added 231,000 workers in March, down from 234,000 in February (and 269,000 in November, its recent peak). At the same time, the number of separations – including layoffs, quits, and retirements – rose from 224,000 to 236,000. As such, net hiring (or hires minus separations) shifted from a net gain of 10,000 workers in February to a decline of 5,000 in March. This was well below the net hiring rate of 41,000 observed in November, illustrating the current softness in the labor market.
Meanwhile, employment numbers in the larger economy softened slightly in March, as well. Total job openings decreased from 4,125,000 in February to 4,014,000 in March. Even with the decrease, this was still a decent figure, representing a 3.5 percent increase year-over-year. Hiring in the nonfarm business sector declined from a net gain of 240,000 in February to an increase of 194,000 in March. Education and health services and government were two major sectors that had increased hiring for the month.
Chad Moutray is the chief economist, National Association of Manufacturers.
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