WASHINGTON – U.S. employers advertised the most job openings in nearly five years in February, but overall hiring rose at a much slower pace. The figures suggest companies are too cautious about the economy to quickly fill open jobs.
The Labor Department said Tuesday that the number of available jobs rose 8.7 percent in February from January to a seasonally adjusted 3.93 million — the highest since May 2008.
At the same time, companies hired a seasonally adjusted 4.4 million people. That's just 2.8 percent higher than January. And hiring remains lower than it was a year ago, when it reached 4.49 million.
Economists say there are several likely reasons for the disparity. Unemployed workers may lack the skills employers seek. Or companies may not be offering enough pay.
Hiring slowed sharply in March, despite the increase in job openings the previous month. Employers added only 88,000 net new jobs last month. That's the fewest in nine months and nearly half the pace of the previous six months.
Companies may have slowed hiring after steep, across-the-board government spending cuts took effect March 1. Those cuts are expected to shave about a half-point from economic growth this year.
Many companies may also be more reluctant to fill positions until they find the perfect candidate, according to many recruiting and staffing firms.
The increase in openings has steadily reduced the competition for each job. There were 3.1 unemployed people, on average, for each opening in February. That's down from a peak of 6.7 in July 2009, the highest in the 12 years the government has tracked the data.
But February's ratio is still above the ratio of 2 to 1 that is typical in a healthy economy. And in February, roughly 12 million Americans were unemployed.
Until companies start filling more jobs, the smaller ratio may prove to be less significant than in healthier economies.