Amid a slew of economic data released by government agencies tied to February and March, job openings across the United States were at a seven-month high as measured in February. And as Reuters reported, the hiring pace was down.
The end result is a tighter labor market, and on the heels of that tightening, wage increases may be in the offing.
As the headline numbers go, job openings across the country were up 118,000, which represents a seasonally adjusted 5.7 million. Labor Department data that came out on Tuesday (April 11) showed that the percentage of job openings, as measured as a percentage of total jobs, was 3.8 percent, up 10 basis points from a longer-term pace of 3.7 percent. The mismatched labor market is also showing that mismatch in an era where the unemployment rate has just hit its lowest level in a decade and now stands at 4.5 percent.
The newswire noted, though, that the hiring rate was down and was measured at 5.3 million positions in February, down from 5.4 million in January. In an interview with Reuters, Chris Rupkey, the chief economist at MUFG Union Bank in New York, stated that the latest data shows that there is “one of the most gigantic skills mismatches out there across the country that we have ever seen in history.”
Wages are already on the rise and have been. In the latest data, wage growth continued a modest streak, where average hourly earnings were up a nickel in March, a showing that came on the heels of a $0.07 increase in February. The annualized boost has been 2.7 percent. It’s not clear what will happen to this pace, if it will continue at this rate or accelerate. But with the mismatch of desired skills and applicants, the pressure may be on for employers to attract new talent and maintain teams and individuals already in place. In further testament to the positive momentum in wages, the Store Front Index saw wages up by 6.1 percent in the latest quarterly reading.