Economy Watch: Number of Job Openings Jumps
There were 4.8 million U.S. job openings on the last business day of August, up from 4.6 million in July, the Bureau of Labor Statistics reported in its Job Openings and Turnover Summary (JOLTS).
By Dees Stribling, Contributing Editor
There were 4.8 million U.S. job openings on the last business day of August, up from 4.6 million in July, the Bureau of Labor Statistics reported on Tuesday in its Job Openings and Turnover Summary (JOLTS). That’s the highest level since the BLS created this particular metric in 2000, indicating that employers want to hire more briskly these days.
The BLS also reported that there were 4.4 million total separations in August, a drop from 4.6 million the month before. By the BLS’ reckoning, separations include quits, layoffs and discharges, and other separations. Total separations is also referred to as turnover.
Quits are generally voluntary separations initiated by the employee, meaning that the quits rate is an indirect measure of the health of the employment market, since it’s a measurement of workers’ willingness or ability to leave jobs. Quits came in at 2.5 million in August, about the same as in July, the BLS said.
Household debt burden drops in Q2
The Federal Reserve said on Tuesday that its calculation of U.S. household Debt Service Ratio (DSR) as of the second quarter of 2014 is almost as low as it’s ever been since the central bank started keeping track in 1980. DSR is the ratio of total required household debt payments to total disposable income, and it came in at 9.91 percent in 2Q, down from 9.96 percent in the first quarter and 10.02 percent a year earlier.
Only the second quarter of 2012 was lower, at 9.84 percent. Most of the time in the last 34 years, the ratio has been between 10 percent and 12 percent, but during the housing bubble days, when mortgages grew larger, the ratio reached a high of 13.17 percent in Q4 2007.
The DSR is divided into two parts. The Mortgage DSR (4.71 percent in Q2 2014) is total quarterly required mortgage payments divided by total quarterly disposable personal income. The Consumer DSR (5.2 percent in Q2 2014) is total quarterly scheduled consumer debt payments divided by total quarterly disposable personal income. The Mortgage DSR plus the Consumer DSR equal the overall DSR.
IMF adjusts growth forecasts downward
The IMF released its latest global growth forecast on Tuesday, and it expects worldwide economic growth to average 3.3 percent in 2014―unchanged from 2013, and down from a prediction of 3.4 percent it made in July―and to rise to 3.8 percent in 2015, instead of 4 percent. The weaker-than-expected growth outlook for 2014 reflects setbacks to economic activity in the advanced economies during the first half of this year, and a less optimistic outlook for several emerging market economies, according to the report.
Wall Street seemed to take the IMF report to heart, and had a serious down day on Tuesday, with the Dow Jones Industrial Average off 272.52 points, or 1.6 percent. The S&P 500 lost 1.51 percent and the Nasdaq declined 1.56 percent.