The U.S. labor market changes quite a bit, with hirings, firings, gains, and losses. The graph above represents this dynamic situation: In red (in negative territory) are all the job separations and in blue are all the new hires. The end result is the net creation of jobs. The series used here are not seasonally adjusted, so one can readily see strong patterns—both throughout the individual years and during recessions and booms. It is also remarkable how small the net effect is with respect to the two series. The labor market always moves, and the net gains happen at the margin. But it could be different, of course: Separations could occur mostly or even only during recessions and hires could occur only during booms. But the reason that doesn’t happen is that not every region or every sector of the economy follows the same pattern as the overall economy. Also, even during recessions, people frequently change jobs and businesses need new workers, just as businesses can close even during booms. There is a lot of churning out there.

How this graph was created: Look for “Hires: Total Non Farm” (level in thousands, not seasonally adjusted) and graph that series. Then add the series “Total Separations: Total Nonfarm” (also level in thousands, not seasonally adjusted). Transform the latter series by applying the formula -a. Then choose graph type “Area” with “Normal” stacking.

Suggested by Christian Zimmermann