Monthly data are always erratic, and sometimes they simply don’t make any sense. The April data on job openings in the Job Openings and Labor Turnover Survey (JOLTS) fit in this category. There was a big jump in job openings that drew lots of headlines.
The problem is almost the entire increase in job openings, more than 90 percent, was attributable to an enormous rise in the professional and business services category. This category includes a wide range of high-paying and low-paying industries like legal and computer services, as well as temporary employment and waste management. The rise for this sector in April was over 60 percent from its March level.
To my view, that doesn’t seem very likely. Is there reason to believe that companies are suddenly looking for a lot more workers to deal with computers (what happened to AI taking all the jobs?) or to throw out their trash?
The other two components of the JOLTS data also don’t fit here. Hires in the sector fell by more than 10 percent. There is suddenly an explosion in job openings, but the bosses can’t find anyone to take the jobs they are offering? It’s the same story with separations, mostly quits and layoffs. These were also down by more than 10 percent. Apparently, there aren’t any workers in the sector who hear about the explosion in openings and then decide to leave their jobs for better ones.
Whatever caused the explosion in job openings in the professional and business services category didn’t seem to have much impact in other sectors. Some, like manufacturing and health care, showed modest increases. But others, like retail trade, financial services, and restaurants, had declines in openings.
Overall, the number of hires fell by almost 8.0 percent, as did the number of separations. These numbers seem far more important than the jump in openings, driven by the data from the professional and business services sector.
We get the May jobs report on Friday. My bet is that there will be no surge in jobs in the sector. We’ll get the May JOLTS data next month. My guess is that there will be a big fall in job openings in professional and business services in that data. But the takeaway is that when one number is completely out of line with everything else we are seeing, it’s probably best not to put much stock in it.
The Quarterly Census of Employment and Wages Shows a Somewhat Better Employment Picture
Every year the Bureau of Labor Statistics (BLS) benchmarks its jobs numbers to the Quarterly Census of Employment and Wages (QCEW). These data come from the filings for unemployment insurance, which cover more than 99 percent of all payroll employees. BLS typically publishes a preliminary revision in August or September, with the final number included with the January jobs report the next year.
In the last two years, there were large downward revisions to job growth, with the reported growth being revised down by more than 500,000. We now have three quarters of data for the year 2025-2026. (The benchmark month is March.) At this point, it looks like the QCEW employment data is running somewhat ahead of the monthly data in the Current Employment Situation (CES) survey that get reported every month. This suggests that the revision this year could be upward.
A friend passed along a note from Goldman Sachs research department that offers a possible explanation for this discrepancy. It suggested that companies don’t file unemployment insurance (UI) forms for undocumented workers. They might include these workers in answering the CES survey but not list them for UI. Now that immigration has virtually stopped, there are many fewer workers in this category.
This is at least a plausible story. It also has the interesting implication that, while the Trump administration has been screaming about undocumented workers getting benefits for which they are not eligible, this story would mean that they actually are not getting benefits for which, in principle, they would be eligible. (That assumes employers take the money out of their paychecks.) Anyhow, we’ll see what the preliminary benchmark revision shows in a few months.
One other point about the QCEW data. Through the first three quarters, the decline in employment in manufacturing has been somewhat larger than in the CES data. So much for the boom in manufacturing that Trump keeps boasting about.
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