Job openings in US remain at record low

While layoff pace slows, employers are still hesitant

By Courtney Schlisserman
Bloomberg News / July 8, 2009
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WASHINGTON - Job openings in the United States remained at a record low level in May, indicating that while employers have slowed the pace of layoffs they are still hesitant to add staff.

Openings, or the number of jobs available as a percentage of total employment, remained at 1.9 percent, Labor Department data showed yesterday in Washington. The reading matches that of March and April as the lowest since record-keeping began more than eight years ago.

Employers are cutting jobs at a slower rate than earlier this year after eliminating about 6.5 million positions since the recession began in December 2007, the most of any downturn since World War II. The Labor Department said last week the economy lost 467,000 jobs in June. That’s more than economists had forecast, and they predict unemployment will keep rising.

“We’ll see a significant slowing down in payroll losses over the next few months as companies are getting to the point where they’re more comfortable about costs,’’ Kurt Karl, chief US economist at Swiss Reinsurance Co. in New York, said before the report. “It’s just a long way off before we see payrolls turn positive.’’

Total positions available increased to 2.55 million in May from 2.51 million in the prior month, the Labor report said. The separations rate, which includes dismissals and those who quit their jobs, fell to 3.3 percent of total employment from 3.5 percent in April.

The hiring rate fell to a record low 3 percent from 3.1 percent. At the same time, the rate of layoffs and discharges fell to 1.7 percent from 1.9 percent in April. Other measures also show companies are slowing the pace of firings. While the number of people collecting unemployment benefits totaled 6.7 million as of the week ended June 20, according to the Labor Department, the figure fell last month for the first time since January.

Some companies are forecasting an end to payroll cuts.

Richard Parod, chief executive officer of Lindsay Corp., said July 1 that the maker of GrowSmart irrigation equipment - which had eliminated almost 37 percent of its workforce by the end of the third quarter - doesn’t anticipate “significant further reductions.’’

Even so, a Labor report on July 2 showed the jobless rate rose to 9.5 percent in June, the highest level since August 1983. A measure of hours worked fell and average hourly earnings had the smallest year-over-year gain since September 2005.

Gannett Co., the largest US newspaper owner, will eliminate about 1,400 publishing jobs by tomorrow, Bob Dickey, president of the company’s US Community Publishing unit, said July 1 in a memo to employees. The cuts account for about 3.4 percent of Gannett’s workforce.

Auto manufacturers are cutting their workforces as they restructure, steps that may ripple through related industries for months to come. General Motors Corp., currently reorganizing in bankruptcy, said June 23 it will offer buyouts and retirement incentives to scrap about 4,000 US salaried jobs by Oct. 1.