Fast rise in job openings brightens hiring outlook

Posted April 13, 2011, at 7:57 p.m.

WASHINGTON  — Companies are advertising more job openings than at any time in the past two years, suggesting April will mark a third straight month of strong hiring.

The 3.1 million job openings posted in February indicate that businesses are gaining more confidence in the economy. People are spending more, buying furniture, clothes and electronics and eating out. That raises corporate revenue.

High gas prices threaten the momentum, though. The national average for a gallon passed $3.80 on Wednesday.

“We’ve turned the corner in terms of job growth,” said Scott Brown, chief economist at Raymond James. “Unfortunately, there’s this big cloud of higher gasoline prices hanging over everything.”

Competition for the job openings is easing, though still intense. There were 4.4 unemployed people, on average, competing for each available job in February. That’s down from nearly seven in July 2009, but still above the 2-to-1 ratio in a healthy economy.

The rise in employment advertisements, reported Wednesday by the Labor Department, is the latest sign that companies are stepping up hiring. Openings jumped more than 350,000, from 2.7 million in January, the largest rise in almost seven years.

The private sector in March added more than 200,000 jobs for a second straight month, the first time that’s happened since 2006. And the unemployment rate fell to 8.8 percent, the lowest in two years.

Job openings are usually filled one to three months after they’re posted, which means the report can be an indicator of future hiring activity. If that holds true, April could be another strong month for job growth.

More people are also quitting their jobs, and layoffs are near the slowest in the 10 years that the government has tracked the data. That suggests people are feeling bolder about their prospects.

The brighter hiring outlook is giving people more confidence to spend.

Retail sales rose for the ninth straight month in March, the Commerce Department said. Two-thirds of the increase went to gas station sales, presumably to pay for higher gas prices. But excluding gas and the largest monthly decline in auto sales in a year, Americans still spent 0.6 percent more in March than the previous month. Auto sales can be volatile because people don’t buy cars very often, so economists sometimes remove them to get a better feel for trends in retail sales.

Many analysts considered the gain solid, especially considering Easter falls later than usual this year, delaying some sales. They also noted that sales in January and February were revised to show slightly better gains. And the decline in auto sales was partly because General Motors scaled back some incentive programs.

A wide range of retail chains reported higher revenues, according to data released last week that measure stores open for at least a year. Sales rose 11 percent at Saks Inc. and 13 percent at Costco Wholesale Corp. And Victoria’s Secret parent Limited Brands Inc. enjoyed a 14 percent gain.

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