Job openings increase in May after April drop

WASHINGTON — Job openings increased in May after plunging the previous month, easing concerns that the job market was faltering.

The number of positions to be filled climbed 195,000 to 3.64 million, partially countering the 294,000 drop in April, the Labor Department said Tuesday in Washington.

Another report showed confidence among small companies slumped in June.

The increase in job openings in May was broad-based. It was led by manufacturers and state and local government agencies, according to Tuesday's report. Only employers in the arts and entertainment industry had fewer jobs available.

Employment climbed by 148,000 to 4.36 million in May, pushing the hiring rate up to 3.3 percent from 3.2 percent the prior month. Professional and business services, which include temporary-help agencies, and health-care providers saw the biggest increases in staffing.

About 2.12 million people quit their jobs in May, little changed from 2.11 million the prior month. That pushed the total separations rate to 3.3 percent, highest since June 2010.

Considering that 12.7 million Americans were unemployed in May, Tuesday's figures indicate there are about 3.5 people vying for every opening, up from about 1.8 when the recession began in December, 2007.

Increasing demand for workers indicates some companies see an opportunity to expand as sales improve. But the report showed job eliminations also picked up, indicating the European debt crisis and slowing growth in emerging markets like China may be prompting some employers to cut back.

"The labor market still looks pretty tenuous," said Michael Feroli, chief U.S. economist at JPMorgan Chase in New York. The April report "sent some worrying signals that maybe things were in free fall. You have the May report and you can see businesses were turning a bit more cautious, but they weren't completely pulling back."

Confidence among U.S. small companies dropped in June to its lowest point since October, driven by concern sales and the economy will deteriorate, another report Tuesday showed. The National Federation of Independent Business' optimism index fell to 91.4 from 94.4 in May — the biggest monthly decline in two years. Eight of its 10 components contributed to the slump, the Washington-based group said.

"The immediate future doesn't look good," William Dunkelberg, the federation's chief economist, said. "Nobody really expects business conditions and consumer spending to get any better."

"Companies are hiring the minimum number of people needed to do the additional work that needs to be done," Carl Camden, president and chief executive officer at staffing provider Kelly Services Inc., said last week on Bloomberg TV.

"They are not making investments in new products, new ventures, new software beyond what they have to. They are not going to until there is more economic certainty, policy certainty, and the situation in Europe clears up." he said.