Adjusted Estimates of Worker Flows and Job Openings in JOLTS

Visiting Scholar
Steven J. Davis
The Job Openings and Labor Turnover Survey (JOLTS) is an innovative data program that delivers national, regional and industry estimates for the monthly flow of hires and separations, and for the stock of unfilled job openings. Analysts have seized on JOLTS data as a valuable source of insights about U.S. labor markets and an important new research tool for evaluating theories of labor market behavior. Recent studies draw on JOLTS data to investigate the cyclical behavior of hires and separations (Hall, 2005), the Beveridge curve relation between unemployment and job vacancies (Valetta, 2005; Fujita and Ramey, 2007; Shimer, 2007b), the connection between quits and employer recruiting behavior (Faberman and Nagypál, 2007), and the relationship among vacancies, hires and employment growth at the establishment level (Davis, Faberman, and Haltiwanger, 2006, 2007). Given the key roles played by job vacancies and worker flows in prominent search-based theories of unemployment along the lines of Mortensen and Pissarides (1994), JOLTS will continue to attract keen interest from researchers.

In addition to notable virtues, the JOLTS program presents measurement issues that are imperfectly understood and not widely appreciated. Reasons for concern can be seen in three simple comparisons to other data sources. First, the aggregate employment growth implied by the flow of hires and separations in JOLTS consistently exceeds the growth observed in its national benchmark, the Current Establishment Statistics survey.[1] Cumulating the difference between hires and separations from 2001 to 2006 yields a discrepancy of 6.6 million nonfarm jobs. Second, JOLTS hires and separations are surprisingly small compared to similar measures in other data sources.[2] Third, the cross-sectional density of establishment growth rates shows much less dispersion in JOLTS than in data sources with comprehensive establishment coverage.[3] . . .

Download file Click here to view text of the full chapter as an Adobe Acrobat PDF.

Steven J. Davis is a visiting scholar at AEI.

Notes

1. See Wohlford et al. (2003), Nagypál (2006) and Faberman (2005a).
2. See Faberman (2005a) and Davis, Faberman and Haltiwanger (2006).
3. See Faberman (2005a).

Also Visit
AEIdeas Blog The American Magazine
About the Author

 

Steven J.
Davis
  • Steven J. Davis studies unemployment, job displacement, business dynamics, the effect of taxes on work activity, and other topics in economics. He is deputy dean for the faculty and professor of international business and economics at the University of Chicago Booth School of Business, a research associate at the National Bureau of Economic Research, and an economic adviser to the U.S. Congressional Budget Office.  He previously taught at Brown University and MIT.  As a visiting scholar at AEI, Mr. Davis studies how policy-related sources of uncertainty affect national economic performance.

What's new on AEI

AEI Election Watch 2014: What will happen and why it matters
image A nation divided by marriage
image Teaching reform
image Socialist party pushing $20 minimum wage defends $13-an-hour job listing
AEI on Facebook
Events Calendar
  • 20
    MON
  • 21
    TUE
  • 22
    WED
  • 23
    THU
  • 24
    FRI
Monday, October 20, 2014 | 2:00 p.m. – 3:30 p.m.
Warfare beneath the waves: The undersea domain in Asia

We welcome you to join us for a panel discussion of the undersea military competition occurring in Asia and what it means for the United States and its allies.

Tuesday, October 21, 2014 | 8:30 a.m. – 10:00 a.m.
AEI Election Watch 2014: What will happen and why it matters

AEI’s Election Watch is back! Please join us for two sessions of the longest-running election program in Washington, DC. 

Wednesday, October 22, 2014 | 1:00 p.m. – 2:30 p.m.
What now for the Common Core?

We welcome you to join us at AEI for a discussion of what’s next for the Common Core.

Event Registration is Closed
Thursday, October 23, 2014 | 10:00 a.m. – 11:00 a.m.
Brazil’s presidential election: Real challenges, real choices

Please join AEI for a discussion examining each candidate’s platform and prospects for victory and the impact that a possible shift toward free-market policies in Brazil might have on South America as a whole.

Event Registration is Closed
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.