JOLTS Report Explained

Job openings, hires, and quits — the Fed's preferred window into labor-market slack, and the data series that gave the Great Resignation its name.

What JOLTS tracks

The Job Openings and Labor Turnover Survey, published monthly by the Bureau of Labor Statistics, measures the flow of the labor market rather than just its stock. Where nonfarm payrolls tells you the net change in jobs, JOLTS breaks the picture into job openings (unfilled positions employers are actively trying to fill), hires (workers brought on during the month), and separations, further split into quits, layoffs and discharges, and other separations.

JOLTS is released with a longer lag than most labor data — typically covering data from about six weeks prior — which limits its use as a timely signal but makes it valuable for understanding the underlying dynamics behind the headline jobs numbers that already landed.

Why the Fed watches openings so closely

The ratio of job openings to unemployed workers has become one of the Federal Reserve's favored gauges of labor-market slack — how much room exists between labor supply and labor demand. A high ratio of openings to unemployed workers signals a tight labor market where employers are competing hard for scarce workers, which tends to push wages up and feeds into the Fed's inflation calculus. A ratio moving back toward balance suggests slack is building, giving the Fed more room to ease policy without reigniting wage-driven inflation.

This ratio became a central talking point in Fed communications during the post-pandemic period, when openings vastly outnumbered available workers, and it remains one of the metrics Fed officials reference when explaining how they're reading labor-market tightness independent of the unemployment rate.

The quits rate as a confidence signal

The quits rate — the share of the workforce voluntarily leaving jobs in a given month — is read as a proxy for worker confidence. People generally don't quit a job without another one lined up or strong confidence they can find one quickly, so a rising quits rate signals workers feel secure in the labor market, while a falling quits rate suggests growing caution, even if layoffs haven't visibly picked up yet. This dynamic is what made the phrase "Great Resignation" a defining label for the elevated quits environment that followed the pandemic reopening.

Markets generally treat JOLTS as a slower-moving confirmation of trends already visible in payrolls and claims data rather than a standalone catalyst, but a sharp divergence — openings falling fast while payrolls still look healthy — can shift Fed rate expectations and move Treasury yields, since it often marks a labor market cooling from the inside before it shows up in the unemployment rate.