US job openings hit 13-year high in June. Good for higher wages?

Bryan CronanThe Christian Science Monitor

More than they have in over a decade, employers in the US are looking for workers. 

There were 4.7 million job openings posted in June, the highest number of openings since February 2001, according to the Job Openings and Labor Turnover Survey (JOLTS) released Tuesday by the US Bureau of Labor Statistics (BLS) . That was up 2.6 percent from the 4.6 million job openings in May. The number of job openings has risen steadily since January, averaging 159,000 a month. The hiring rate also climbed slightly in June to 3.5 percent, up from 3.3 percent in May. The total number of hires in June was 4.8 million, up from 4.7 million in May.

The high number of job openings echoes other good news on the jobs front in recent weeks and months. According to BLS data released last week, July was the sixth straight month of job gains exceeding 200,000, the first time this has happened since 1997. July also saw the unemployment rate fall to 6.2 percent, down one percentage point from July 2013. That could have broader implications for the economy at large: Federal Reserve chief Janet Yellen uses JOLTS as one of her go-to indicators and has repeatedly emphasized the importance of the job market on Fed policy decisions.

“There’s improvement, but it’s still slow and uneven,” said Joseph LaVorgna, chief U.S. economist at Deutsche Bank Securities Inc. in New York, told Bloomberg.

During the most recent recession, the number of job openings declined significantly, bottoming out at around 2 million job openings in July 2009. Employment numbers have steadily increased, with more than 138 million Americans currently employed.

Professional and business services saw the biggest increase in openings, adding 46,000 job openings from May to June 2014.

"The trajectory in improvement in the labor market we have seen continues. The question is whether we have more traction going into the second half of the year," Sam Bullard, senior economist at Wells Fargo Securities in Charlotte, N.C., told Reuters.

Data from Bloomberg showed that there are an average of two unemployed workers competing for every job in the US, down from an average of 2.6 at the start of 2013. That lack of demand, some analysts suggest, could encourage firms to raise wages, which have barely budged as the economy has recovered.