The failure of Wednesday’s monthly Labor Department reading on job turnover (for August) to attract much attention amid presidential campaign scandals is as understandable as it’s unfortunate. For this last set of “JOLTS” numbers that we’ll get before election day continues showing levels of openings in low-wage sectors hovering near recent highs recorded during this recovery. And the more generally humdrum nature of the findings – total openings fell sequentially to an eight-month low of 5.443 million – could cast a little more doubt over the chances of the Federal Reserve viewing the economy and labor market as strong enough to justify another interest rate hike.
These low-wage portions of the economy consist of the retail sector, leisure and hospitality industries, and the big low-wage administrative and support services sub-sector of the larger and higher wage professional and business services category.
Add up the August openings in these industries and you come up with 32.98 percent of the total (which is still preliminary). That’s not a record for this troubled recovery – but it’s close. Further, it’s higher than July’s final 32.36 percent, which itself was revised up from 32.17 percent.
For some perspective, recall that when the Great Recession officially began, at the end of 2007, low-wage job openings made up 31.94 percent of total openings. At the recovery’s outset, in June, 2009, their share fell to 28.38 percent. So during the current expansion, this number is up more than four and a half percentage points.
The JOLTS data – which are widely thought to be especially closely followed by Fed chair Janet Yellen – also shed light on the prominence of the subsidized private sector in the recovery’s jobs landscape. These are parts of the economy that are placed into the private sector category by the statisticians, but that depend heavily on government spending for their activity levels and therefore the vigor of their hiring. Healthcare services are the leading example.
In August, they accounted for 15.75 percent of all the nation’s non-farm jobs. (The Labor Department’s American employment universe.) But that month, they generated 19.20 percent of all job openings – a finding consistent with their lead role in actual employment growth during the recovery. As a result, rather than accounting for nearly 91 percent of these employment opportunities in August, the “real” private sector produced only about 71.50 percent.
When the Great Recession began at the end of 2007, subsidized private sector openings made up 17.65 percent of the total. When the recovery began in mid-2009, the figure was 22.28 percent – since at that point the national employment picture remained so bleak that the subsidized private sector was virtually the only sector showing any signs of life. And even today, the figure is two and a half percentage points higher than before the last downturn.
Needless to say, since employment issues themselves have barely been discussed in the general election campaign, it’s inconceivable that these JOLTS trends would be brought up. And needless to say, that’s a great way to ensure that the national jobs market becomes ever more dominated by depressingly unproductive industries like healthcare and by menial service positions.