The September jobs report was startlingly positive, beating many expectations and showing the lowest jobless rate since January 2009. However, new data from the Labor Department suggest that the job market remains fundamentally weak.
In August, there were nearly 3.6 million job openings in the economy, down slightly from July. Hiring picked up slightly, from nearly 4.3 million to nearly 4.4 million new hires, but layoffs picked up even more, from nearly 1.6 million to over 1.8 million.
While 4.4 million hires may sound like a lot of jobs in comparison to the 142,000 jobs that employers reported adding in August, plenty of people—nearly 4.4 million—also left their jobs, making for a net increase of 36,000. These monthly net increases should be roughly comparable to the job figure produced by the monthly establishment survey, according to the Labor Department.
Though the data are for August, the fact that they represent little improvement supports the idea that September's surprisingly strong jobs report may have been more of a blip than the start of a new resurgence in the job market.
"The job openings number is down two months in a row, and it's the weakest since April. So that's the main indicator people are looking at here, and it doesn't look that good," says Gad Levanon, director of macroeconomic research at the Conference Board.
He adds that while businesses have "much less fat to trim" than before the recession, some firms facing growing uncertainty in the forms of weak demand and the fiscal cliff are working on remaining as lean as possible.
"When they're concerned about the fiscal cliff, it makes executives more cautious about increasing their workforce," says Levanon.
The relatively few people quitting their jobs is another indication of a soft labor market. In August, 2.1 million people quit their jobs, only slightly up from one year ago and far below the level seen before the recession, when around 3 million people a month chose to leave their jobs voluntarily. The level of departures can be seen as a measure of labor market strength, indicating that workers are either leaving their old jobs for new ones or are simply confident enough to quit their old jobs and seek out new work.
"You'd think that as the expansion goes on and people found opportunities they'd quit their jobs, but it's not happening," says Levanon.
Even taking September's jobs report into account, he says, the jobs outlook is grim.
"I would say that in general, leading indicators of employment have been quite weak lately," he says, projecting that job growth in the first quarter of next year is likely to be slower than the fourth quarter of this year.
Indeed, the Conference Board's latest Employment Trends Index, a figure that represents a broad variety of job market-related indicators, declined for the month of September. One major contributor to that decline was the number of Americans who are involuntarily working part-time. In other words, even while unemployment is going down, underemployment is staying strong.
Still, the latest Labor Department figures also show some broad, if slow, improvement from one year ago. Job openings were more than 400,000 higher than in August 2011, and hires have generally trended upward over the last year and a half.
Danielle Kurtzleben is a business and economics reporter for U.S. News & World Report. You can follow her on Twitter or reach her at firstname.lastname@example.org.