The job openings in the United States increased to a 14-year high in the month of February, but the pace of hiring remained steady, suggesting that the American employers have been facing trouble in finding suitable workers. The prevailing trend is likely to put upward pressure of growth in wages.
The job openings, which are measure of labor demand in the country, rose 168,000 to a seasonally adjusted 5.1 million. This was the highest level recorded since January 2001.
The figures were released on Tuesday by the US Labor Department as a part of its monthly Job Openings and Labor Turnover Survey.
The hiring of new employees was little changed at 4.9 million in the month of February, leaving the rate of hiring steady at 3.5 percent.
John Ryding, chief economist at New York-based RDQ Economics, said, “We interpret the combination of rising job openings and slower hiring as a potential sign of increased mismatch between the needs of employers and the skills of available workers.”
This clearly implies that the employers will require raising wages that was remained tepid despite a significant pick-up job gains.
The Federal Reserve Bank is closely following the so-called JOLTS report before taking its final call on raising the rates of interest this year. The US central bank has left its benchmark overnight interest rate untouched near zero since December 2008.
Even if the growth in employment braked sharply last month after 12 consecutive months of job gains above 200,000, the report by JOLTS indicated that the country’s labor market remained firm.
The number of unemployed people looking for job per open job dropped to 1.70 in February, which is the smallest since November 2007. The ratio was recorded at 1.81 in January.
According to the JOLTS report, there was a slower pace of layoffs in the month of February. The layoffs and discharges rate dipped to 1.1 percent from 1.2 percent in January.