U.S. JOLTS: Job Opportunities Increase but Hiring Lags
(…) As of the last business day of July, the job openings level rose to 6.618 million, down 8.5% y/y. The job openings level in the construction sector fell 5.4% y/y and in manufacturing by 14.5% y/y. It fell by 20.6% y/y in leisure & hospitality and by 6.8% y/y in the professional & business service sector. In government, the number of job openings declined 5.1% y/y. (…)
In July, the level of hiring fell 17.0% to 5.787 million (-3.1% y/y) following a 3.2% June decline. (…) Private sector hiring fell 2.7% y/y and government hiring was off 10.0% y/y. Hiring in the factory sector fell 4.2% y/y but leisure & hospitality hiring rose 4.3% y/y. Professional & business service sector hiring weakened 4.9% y/y and education and health services hiring declined 2.0% y/y. (…)
Updating yesterday’s “Input Gap” chart with July’s JOLT numbers. Job openings made it back to its declining trend while hires has flatlined.
Some private companies have more up-to-date numbers:
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U.S. Job Openings Leveled Off Late in the Summer The number of available jobs in the U.S. leveled off late this summer, the latest sign momentum in the labor market is easing six months after the coronavirus pandemic took hold in the U.S.
The increase in the number of job postings, a real-time measure of labor-market activity, has slowed dramatically since late July, and last week stood about 20% below 2019 levels, according to data the job-search site Indeed.com shared with The Wall Street Journal. (…)
The number of weekly shifts workers reported for rose 0.5% in August from July, according to Kronos, a workforce management software company. That was the third straight month the pace slowed, and is down from a 2.7% gain in May. Shifts worked rose at the same 0.5% pace the first week of September, Kronos said Wednesday. (…)
Companies “will need to see consumer demand returning to re-accelerate hiring into the fall. That hasn’t yet happened.” (…)
There is other, perhaps more interesting color from the indeed.com post that the WSJ omitted:
(…) Job postings have fallen most in occupations directly affected by the coronavirus such as hospitality & tourism and sports, where postings are still more than 40% below last year’s trend. Postings are far below last year’s trend in many higher-wage office sectors, too, like software development and banking & finance.
In several goods-related sectors, job postings are back to near last year’s levels. Construction, loading & stocking, retail, and driving job postings are within a few percent of last year’s trend, but driving has slowed in the past two weeks. (…)
Job postings for higher-wage occupations have fallen the most. Initially, postings in higher-wage occupations fell less than those in middle- and lower-wage occupations, but have subsequently lagged. Postings in higher-wage occupations are now 25% below trend, versus 13% below trend for lower-wage occupations.
This pattern in job postings is different from the trend in employment. Bureau of Labor Statistics data through mid-August show that lower-wage industries have lost the most jobs in the pandemic, by a wide margin. Lower-wage industries like retail and food service adjust their workforces in response to month-to-month or even week-to-week changes in demand. But it is more expensive and often takes longer to fire and hire higher-wage workers. Higher-wage industries like tech and finance might plan their headcounts based on what they expect demand to look like longer-term, in future quarters or years. (…)
Job postings have recovered more in smaller metros than in larger ones, even though smaller metros backslid more in August. Postings are down 11% in the smallest metros, versus 28% in the largest metros. New COVID19 cases and deaths, however, are now higher in smaller metros and rural areas than in larger metros — a reversal of the pattern at the start of the pandemic. (…)
Looks like a swoosh to me…One last chart on this: the YoY change in aggregate hours worked through mid-August has clearly swooshed whether you look at all priviate employees, all production employees or manufacturing employees. You need to get hours back before hiring more people.
- Amazon announced it will hire 33,000 new corporate and technology workers at an average compensation of $150,000, including salary and stock. (Axios)
Meanwhile, also swooshing:
Morning Consult Index of Consumer Sentiment (ICS)
Spiking:
- Mahattan apartments are piling up again. Rental listings jumped to a record 15,025 at the end of August, more than double the inventory from a year ago, according to Miller Samuel and Douglas Elliman Real Estate. The vacancy rate also reached a new high of 5.1%. Renters are finding few reasons to sign new leases, with Midtown offices still largely empty and public school reopening an unresolved question. (Bloomberg)
Oxford Covid-19 Vaccine Still Possible by Year-End, AstraZeneca CEO Says
(…) “What we have here is a special set of circumstances where the whole world becomes involved in the conduct of a clinical trial,” Soriot said in his first public comments since the trial was halted. The decision on whether to resume the study is in the hands of a group of independent experts working to understand whether the patient’s illness was a coincidence or a result of the vaccine. “The reality is we all have to be very patient and see how it unfolds,” he said. (…)
The CEO, speaking at a Tortoise Media event Thursday, said he can’t evaluate the length of the trial pause. When tests are complete the physicians will share the data with the safety committee, he said. (…)
- Pfizer CEO Albert Bourla told CEOs assembled by Fortune and McKinsey yesterday that there is a “more than 60% chance” his company will know by the end of October whether its vaccine works. Pfizer has already vaccinated some 26,000 people in its Phase III trials, and company modeling shows the results should be in by the end of next month. (Fortune)
Virus cases fall 13%
New coronavirus cases fell by almost 13% over the past week — a significant improvement, [Axios] Sam Baker and Andrew Witherspoon report. Things are moving in the right direction again after a brief plateau. Getting the virus under control now will give the U.S. a much better shot at a safe autumn.
The U.S. is now averaging about 37,000 new cases every day. That’s a lot, and we’re not even halfway back to the lower totals we were recording before cases surged this summer.
The chart above shows official confirmed COVID-19 per capita case numbers in a handful of countries – selected because they have all had notable outbreaks of the disease. Different stories emerge: in some, cases are rising, but are still well below previous peaks (UK and Italy); in India, they are relatively low on a per capita basis, but rising and hitting new highs; they are high, but falling, in the US and Brazil; they continue to rise and hit new highs in Spain. (…) (Fathom Consulting)
Bank of Canada Holds Rates, Opens Door to Bond-Buying Tweaks
The Bank of Canada reiterated its pledge to keep interest rates at historic lows for years to come, but dialed back its willingness to take even more aggressive action and said it could adjust its bond purchase program.
In a decision Wednesday from Ottawa, policy makers led by Governor Tiff Macklem held the bank’s benchmark rate at 0.25% and said they’ll leave it unchanged until economic slack is absorbed so that the 2% inflation target is “sustainably achieved.” The central bank also retained a pledge to buy government bonds at the current pace and maintain extraordinary monetary policy stimulus throughout what it calls the recuperation phase of the recovery. (…)
“While recent data during the reopening phase is encouraging, the Bank continues to expect the recuperation phase to be slow and choppy as the economy copes with ongoing uncertainty and structural challenges,” according to the statement. (…)
New Home Construction in Canada Hits Its Highest Since 2007
Canadian banks return to focus on cost controls, resume paused job cuts
TECHNICALS WATCH
- 13/34–Week EMA Trend Chart (CMG Wealth):
On yesterday’s action, Lowry’s Research notes that Breadth and Demand were good but that total NY volume was down 16% from Tuesday’s session. Equities gained back a good portion of Tuesday’s losses but Buying Power was up 2 points yesterday vs down 6 on Tuesday. BP is down 12 points this week. Selling Pressure declined 4 yesterday vs up 6 Tuesday. WtD: up 7.
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Pricked
It’s not just the Nasdaq Composite or Nasdaq 100 indexes that fell more than 10% below their highs, most of the underlying stocks have as well. About 73% of Nasdaq 100 stocks dropped more than 10% below their 52-week highs.
This is about the “oversold” level in healthy markets. Often, this nears the 75% threshold, and then stocks rebound. The problem is when it doesn’t – the last two times we saw so many stocks fall into correction territory, it was much closer to the start of a sustained pullback than the end. (…)
Momentum tends to be sticky. When it ends, it usually doesn’t just simply reverse and start up again. We see that with most of the developments above – forward returns up to 2 months later tended to be poor, or at least below average. Longer-term returns were average or a little above. Given the massive amount of speculative fervor built up in recent weeks, this pricking of the Nasdaq’s momentum is another worrying sign over the short- to medium-term. (SentimenTrader)
- India’s Reliance Industries offered to sell up to a 40% stake in its retail business to Amazon for about $20 billion, a person familiar said — and Amazon is interested. A deal, if successful, would create a retail behemoth in India. It would also provide Amazon with a brick-and-mortar component to its ambitions in a country where online shopping still only accounts for a small part of the market. (Blomberg)
Trump and coronavirus
President Trump knowingly underplayed the threat posed by COVID-19 in his communications with the American public, the president told legendary journalist Bob Woodward. Woodward has a new book out, making it clear that Trump was fully briefed and aware of the coronavirus’s threat in late January, before he spent months holding campaign rallies and claiming that it was no more harmful than the seasonal flu. Fortune
- Instead of “Rage,” Bob Woodward could have called his book: “Undeniable.” Woodward tapped Trump’s vanity and insecurity to secure an astonishing 18 interviews, totaling nine hours, with the most powerful man in the world. (Axios)
