JOLTS: Job Openings, Hires, and Quits Data

Key Takeaways

• JOLTS job openings measures positions employers are actively trying to fill on the last business day of the month.
• The quits rate is a confidence gauge, since workers quit most when they expect to find better jobs.
• JOLTS data lags the jobs report by about a month, so it confirms trends rather than breaking them.
• The ratio of openings to unemployed workers shows how tight or slack the labor market is.

What It Is

JOLTS is the Job Openings and Labor Turnover Survey, produced monthly by the Bureau of Labor Statistics. It samples thousands of business establishments and estimates four key flows: job openings, hires, quits, and layoffs and discharges. JOLTS job openings count all positions that are open on the last business day of the month, while hires and separations cover all changes to payrolls across the full month.

The report breaks each measure down by industry, region, and firm size. Unlike the headline jobs report, which counts the net change in employment, JOLTS shows the churn underneath: how many people moved in and out of jobs to produce that net figure.

The Intuition

A net jobs gain of 150,000 can come from very different places. It might be 5 million hires against 4.85 million separations in a hot, churning market, or far fewer of each in a frozen one. JOLTS reveals which.

The quits rate is the standout number. People quit when they are confident they can land something better, so a rising quits rate signals worker confidence and bargaining power. A falling quits rate signals caution. The openings number, meanwhile, measures unmet labor demand. When openings far exceed the number of unemployed workers, employers compete for staff and wages tend to rise.

How It Works

Each measure is reported as a level and as a rate. The rate divides the flow by employment to make periods comparable.

job openings rate = job openings / (employment + job openings) * 100

quits rate = quits during the month / employment * 100

A widely watched derived figure is the ratio of job openings to unemployed persons, which combines JOLTS with the unemployment data.

openings per unemployed = job openings / number of unemployed

A ratio above 1 means more open jobs than jobless workers, a sign of a tight market. JOLTS is seasonally adjusted using X-13ARIMA-SEATS and is benchmarked annually. Note the timing: JOLTS for a given month is released about a month after the jobs report for that same month, so it always confirms rather than leads.

Worked Example

Suppose a month shows 8.0 million job openings and 7.0 million unemployed persons.

openings per unemployed = 8.0 million / 7.0 million = 1.14

A ratio of 1.14 means there are 1.14 open jobs for every unemployed worker, a tight but cooling market. If the prior month read 1.30, the drop signals that demand for labor is easing even though openings still outnumber the jobless. Pair that with a slipping quits rate and the read is a labor market losing steam.

Common Mistakes

1. Treating openings as filled jobs. An opening is unmet demand, not employment. A high openings count means employers want workers, not that they hired them.

2. Ignoring the quits rate. The quits rate is often more telling than openings. It captures worker confidence directly and tends to lead wage pressure.

3. Forgetting the lag. JOLTS data is a month behind the jobs report. It confirms a trend already visible, so do not expect it to break news.

4. Reading levels without context. Openings of 8 million mean little alone. Compare them to the number of unemployed and to the recent trend.

5. Over-trusting a single month. JOLTS is revised annually and can be noisy. Watch the multi-month direction of openings and quits together.

Frequently Asked Questions

What is JOLTS job openings in simple terms? JOLTS job openings is the monthly count of positions employers are actively trying to fill. It shows how much demand for workers exists in the economy.

How does JOLTS job openings affect investment decisions? A tight ratio of openings to unemployed workers points to wage pressure and possible Fed tightening, which moves bonds and rate-sensitive stocks. Traders read the quits rate as an early signal of where wages are heading.

What is a real-world example of JOLTS job openings? If there are 8.0 million openings and 7.0 million unemployed people, there are about 1.14 open jobs per jobless worker, a tight labor market.

How can investors use JOLTS job openings effectively? Track the openings-per-unemployed ratio and the quits rate together over several months, not single prints. Use them to confirm the trend the jobs report already suggested.

How is JOLTS different from nonfarm payrolls? JOLTS shows the churn of openings, hires, and quits behind the labor market. Nonfarm payrolls reports only the net change in jobs, without the underlying flows.

Sources

1. U.S. Bureau of Labor Statistics. "Job Openings and Labor Turnover Survey (JOLTS)." https://www.bls.gov/jlt/
2. U.S. Bureau of Labor Statistics. "Job Openings and Labor Turnover Summary." https://www.bls.gov/news.release/jolts.nr0.htm
3. U.S. Bureau of Labor Statistics. "Job Openings and Labor Turnover Technical Note." https://www.bls.gov/news.release/jolts.tn.htm
4. Federal Reserve Bank of St. Louis. "FRED Economic Data." https://fred.stlouisfed.org/

Disclaimer

This article is educational content only and is not financial advice. Nothing here is a recommendation to buy, sell, or hold any security. Consult a licensed advisor before making investment decisions.