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U.S. companies post more jobs, but fill them slowly

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U.S. employers advertised the most job openings in nearly five years in February, but they boosted hiring at a much slower pace. The figures suggest that companies remain too cautious about the economy to quickly fill open jobs.

The number of openings rose 8.7 percent in February from January to a seasonally adjusted 3.93 million, the Labor Department said Tuesday. That was the most since May 2008.

At the same time, companies hired a seasonally adjusted 4.4 million people, just 2.8 percent more than in January. And hiring remains lower than it was a year ago, when it reached 4.49 million.

Economists point to several likely reasons for the disparity between a surge in job openings but only a modest rise in hiring. Many unemployed workers may lack the skills employers want. Some companies may not be offering enough pay.

And recruiting and staffing firms say some employers seem reluctant to fill jobs until they find what they regard as perfect candidates.

U.S. hiring slowed sharply in March, despite the increase in job openings the previous month. Employers added only 88,000 jobs last month, the government reported Friday. That was the fewest in nine months and nearly half the pace of the previous six months.

Some companies may also have slowed hiring after steep government spending cuts began taking effect March 1. Those cuts are expected to shave about a half-point from economic growth this year.

There were 3.1 unemployed people, on average, for each opening in February. That exceeds the roughly 2-to-1 ratio typical of a healthy economy. But it's down sharply from a peak of 6.7 in July 2009, the highest in the 12 years the government has tracked the data.

Still, until employers start filling jobs more quickly, the ratio of unemployed people to openings may overstate the health of the job market.

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  1. You are correct that Obamacare requires health insurance policies to include richer benefits and protects patients who get sick. That's what I was getting at when I wrote above, "That’s because Obamacare required insurers to take all customers, regardless of their health status, and also established a floor on how skimpy the benefits paid for by health plans could be." I think it's vital to know exactly how much the essential health benefits are costing over previous policies. Unless we know the cost of the law, we can't do a cost-benefit analysis. Taxes were raised in order to offset a 31% rise in health insurance premiums, an increase that paid for richer benefits. Are those richer benefits worth that much or not? That's the question we need to answer. This study at least gets us started on doing so.

  2. *5 employees per floor. Either way its ridiculous.

  3. Jim, thanks for always ready my stuff and providing thoughtful comments. I am sure that someone more familiar with research design and methods could take issue with Kowalski's study. I thought it was of considerable value, however, because so far we have been crediting Obamacare for all the gains in coverage and all price increases, neither of which is entirely fair. This is at least a rigorous attempt to sort things out. Maybe a quixotic attempt, but it's one of the first ones I've seen try to do it in a sophisticated way.

  4. In addition to rewriting history, the paper (or at least your summary of it) ignores that Obamacare policies now must provide "essential health benefits". Maybe Mr Wall has always been insured in a group plan but even group plans had holes you could drive a truck through, like the Colts defensive line last night. Individual plans were even worse. So, when you come up with a study that factors that in, let me know, otherwise the numbers are garbage.

  5. You guys are absolutely right: Cummins should build a massive 80-story high rise, and give each employee 5 floors. Or, I suppose they could always rent out the top floors if they wanted, since downtown office space is bursting at the seams (http://www.ibj.com/article?articleId=49481).

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