The unemployment rate is the highest-profile labor market data point, but there are plenty of other ways to gain additional insight into the job market. One such figure is the ratio of unemployed workers to job openings. It’s a straightforward statistic created by combining two key BLS series: unemployment level (via the Current Population Survey) and total nonfarm job openings (via the JOLTS survey).

Exits from the labor force during the COVID-19 pandemic have been analyzed, with research conducted into the reasons for exits and the likelihood of re-entry. It’s led to some debate as to the true tightness of the labor market— after all, total nonfarm payrolls are still 2 million below January 2020 numbers. This ratio sidesteps all that, giving us a measure of labor tightness that reflects firms’ attempts to hire at the present moment.

After reaching a high of 6.5 unemployed workers for every job opening in July 2009, the ratio fell over the next decade to 0.8 in February 2020. It rose to 4.9 unemployed per job opening during the COVID-19 recession, but has since fallen steadily as economic conditions have improved. As of January 2022, it reached the lowest ratio since the BLS began collecting JOLTS data in 2000: just 60 unemployed workers for every 100 job openings. This aligns with reports of widespread labor shortages across several industries; when looking only at the current labor force, there just aren’t enough job seekers for the current level of positions open.

How this graph was created: Search FRED for “Job Openings: Total Nonfarm” (JTSJOL). Set level in thousands, seasonally adjusted. Combine with “Unemployment Level,” thousands of persons, seasonally adjusted (UNEMPLOY). Divide UNEMPLOY by JTSJOL (formula b/a).

Suggested by Nathan Jefferson.

The FRED Blog recently used research from the St. Louis Fed to discuss how pandemic-related immigration restrictions affected the number of job vacancies per unemployed person—a.k.a., labor market tightness.

Today, we revisit this topic by highlighting research pinpointing the urban centers with the tightest labor markets.

The FRED graph above shows data from Indeed.com, an aggregator of online job listings. Indeed reports job posting activity as a 7-day trailing average, presented as an index with a value of 100 on February 1, 2020. Job postings are highly correlated with job vacancies, and the FRED graph shows persistently elevated levels of job postings (as of May 2023) in three metropolitan statistical areas: Jackson, Mississippi; Omaha-Council Bluffs, Nebraska-Iowa; and Madison, Wisconsin.

Recent research from Cassie Marks, Lowell R. Ricketts, William M. Rodgers III, and Hannah Rubinton at the St. Louis Fed explores tightening in local labor markets during the recovery from the COVID-19-induced recession. Their work specifically identifies the cities of Jackson, Mississippi; Omaha, Nebraska; and Madison, Wisconsin, as the urban centers with the tightest labor markets as of May 2023.

For more about this and other research, visit the website of the Research Division of the Federal Reserve Bank of St. Louis, which offers an array of economic analysis and expertise provided by our staff.

How this graph wase created: Search FRED for and select “Job Postings on Indeed in Jackson, MS (MSA).” From the “Edit Graph” panel, use the “Add Line” tab to search for and add “Job Postings on Indeed in Omaha-Council Bluffs, NE-IA (MSA).” Repeat the last step to add “Job Postings on Indeed in Madison, WI (MSA)” to the graph.

Suggested by Diego Mendez-Carbajo.