Job Openings, Quits Rise to Start 2017

Wells Fargo Research Team Wells Fargo

Job openings rose in January despite an outsized decline in federal government openings. The number of voluntary separations jumped to a new cycle high, providing further evidence of a tight labor market.

Openings and Hiring Remain Firm

Job openings rose to 5.6 million in January. Openings increased by 136,000 in professional & business services. Federal government openings declined by 37,000, perhaps reflecting the hiring freeze that began in January.
Over the past year, job openings in natural resources & mining are up 11 percent on a three-month moving average basis, a sign of some recovery in the energy sector.

Will a Rising Quit Rate Presage Higher Wages?

Voluntary separations surged in January, pushing the total number of quitters to a cycle high. The labor market continues to add jobs at a steady clip, and several indicators, such as the unemployment rate, are flashing signs of full employment. However, the FOMC would likely need to see faster wage growth to spur more rate hikes than currently anticipated. Continued momentum in quits could presage a pickup in wage growth.

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