In March, employers advertised 6.55 million open jobs, the most on records dating to December 2000, the Labor Department said Tuesday . At the same time, there were 6.59 million unemployed people.
That’s a historical anomaly. Typically, there are far more unemployed people than advertised job openings — often twice as many. And back in July 2009, just after the Great Recession, there were 6.7 unemployed people, on average, for each open job. With that ratio now at essentially 1 to 1, the job market appears to be tilting in favor of workers and job-seekers rather than employers.
Still, the sharp jump in openings — they rose nearly 8 percent in March — does raise questions. If employers are so desperate, for instance, why aren’t they raising pay sharply enough to attract and keep employees? Though pay has risen modestly in recent months, the gains remain below historical averages.
Some economists say they still think the spike in open jobs means that employers will have to raise pay faster in coming months.
“Employers beware,” said Chris Rupkey, chief financial economist at MUFG Bank. “Wages have nowhere to go but up; it’s just a matter of time.”
Some data suggests that workers are earning more: One measure of wages and salaries rose in the first three months of the year by the most in 11 years. But a separate measure of average hourly pay increased 2.6 percent in April from a year earlier, even as the unemployment rate reached a 17-year low of 3.9 percent.
The last time the jobless rate fell below 4 percent, average wages were rising at a much healthier 4.5 percent annual rate.
So where are all the job openings? The biggest gains in March were in construction, where openings soared by roughly one-third to 248,000. Job listings also jumped in education, professional services like accounting, retail, hotels and restaurants, and shipping and warehousing.
Nick Bunker, an analyst at the Washington Center for Equitable Growth, say she thinks the record-high number of job openings in part stems from weak wage gains.
Typically, as unemployment falls, employers advertise fewer job openings because it tends to cost them more to recruit and pay new employees. But now, with wage gains sluggish, employers may be willing to post jobs because they don’t need to pay so much.
Companies may also now be quicker to post openings online than they would have been to advertise through paid newspaper want ads and other methods that were more typical in the past. Many larger firms use software that scans for keywords to initially screen resumes, which may make it easier and cheaper to post lots of jobs — even those that an employer isn’t yet prepared to fill.
Also, economic research by the Federal Reserve suggests that employers aren’t poaching as many workers who already have jobs as they did in the past, Bunker says. More Americans than in the past are staying in their jobs rather than switching to new ones for higher pay. That’s left more jobs unfilled.
Yet Tuesday’s report, known as the Job Openings and Labor Turnover survey, suggests that that could be changing. The number of people quitting their jobs has increased 6.4 percent in the past year. Workers typically quit when they have other jobs lined up, or are confident they can find one.
That is a sign that job-switching might be recovering. Over time, such a trend would likely increase average wages.