Job openings in the U.S. decreased in April for the first time in three months, showing companies started to lose confidence in the expansion’s durability even before hiring slumped in May.
The number of positions waiting to be filled fell by 151,000 to 2.97 million, the fewest since January, the Labor Department said today in a statement posted on its website. The number of people hired and the number of workers fired also decreased.
The unemployment rate rose to 9.1 percent in May while employers added the fewest workers in eight months, Labor Department data showed last week. More job gains are needed to drive consumer spending after economic growth slowed in the beginning of the year.
“We’ve got a very weak, very mild recovery, which does not create enough demand for labor,” said Henry Mo, an economist at Credit Suisse in New York. “Even if all the open positions were filled overnight, we’d still have almost 11 million workers without jobs.”
Federal Reserve Chairman Ben S. Bernanke today said the jobs data is among recent indicators showing the world’s largest economy had “lost momentum” recently, and said the central bank should maintain record monetary stimulus to boost an “uneven” and “frustratingly slow” recovery.
“Until we see a sustained period of stronger job creation, we cannot consider the recovery to be truly established,” Bernanke said in a speech to a conference in Atlanta.
Another report today showed consumer borrowing rose in April for a seventh consecutive month, led by a gain in non-revolving debt, including auto and student loans. Credit rose by $6.25 billion after a revised $4.82 billion gain in March that was smaller than the previous estimate, the Fed said in Washington.
Stocks erased earlier gains following Bernanke’s comments. The Standard & Poor’s 500 index fell 0.1 percent to 1,284.94 at the 4 p.m. close in New York.
Job openings decreased 4.8 percent in April from a revised 3.12 million in March, the Labor Department report showed.
The loss in vacancies was led by a 91,000 decrease in professional and business services, followed by a 65,000 drop in education and health services. The construction industry had a 28,000 increase in openings in April.
Today’s report helps shed light on the dynamics behind the monthly employment figures. Payrolls rose in May by 54,000 after a 232,000 gain the prior month, Labor Department figures showed on June 3.
Employers took on 3.97 million workers in April, or 95,000 less than the previous month, according to today’s report. Total separations, which include retirements and those who left their jobs voluntarily, decreased to 3.74 million from 3.8 million a month before. The number of firings fell to 1.53 million from 1.61 million.
In the 12 months ended in April, the economy created a net 1.2 million jobs, representing about 47.7 million hires, compared with about 46.4 million separations, today’s report showed.
Workers Per Job
Compared with the 13.8 million Americans who were unemployed in April, today’s figures indicate there were 4.6 people vying for every opening, up from about 1.8 when the recession began in December 2007. The number of jobless rose to 13.9 million in May, pushing the unemployment rate up to 9.1 percent from 9 percent the previous month, the Labor Department reported last week.
May’s employment figures imply the Federal Reserve will keep its benchmark interest rate near zero into next year and pose a challenge to President Barack Obama, whose re-election prospects depend on pushing the jobless rate lower.
“The current accommodative stance of U.S. monetary policy continues to be appropriate because the unemployment rate remains elevated and inflation is expected to remain subdued over the medium run,” Fed Vice Chairman Janet Yellen said in a Tokyo speech last week.
Companies still reducing their workforce include H.J. Heinz Co., the world’s biggest ketchup maker, which in May announced plans to slash as many as 1,000 jobs worldwide and close five factories. Dean Foods Co., the largest U.S. milk processor, said it cut 600 positions last quarter and 140 early this quarter.