One of the biggest obstacles to the Federal Reserve’s goal of reducing inflation has been the tightness of the labor market. When there’s more demand for workers than available supply, the Fed argues, wages go up and so do prices.

The Fed uses a lot of indicators to figure out just how tight the labor market is. This year, it’s been relying heavily on job openings data from the Labor Department. Last month, Fed Chair Jerome Powell said when it comes to understanding the labor market, job vacancies are at the top of his list.

But job openings data might not be telling us what it sounds like it’s telling us.

For instance, it doesn’t cost anything for Madeline Reeves to advertise a job opening on the website of her marketing and consulting firm, Fearless Foundry.

“While we might leave a role open, hoping that the right unicorn will come along, we may be able to just continue on without hiring somebody,” Reeves said.

Even though Reeves isn’t really trying to fill that position, it’s still technically a job opening.

“It’s totally plausible that that employer could show up in the job opening statistic, regardless of how hard she’s trying to fill that role,” said Preston Mui, senior economist at the advocacy group Employ America.

The Labor Department’s Job Openings and Labor Turnover Survey, or JOLTS, asks employers whether they’re “taking steps to fill a position.” That could be anything from interviewing candidates to just posting a position online.

That definition, Mui said, doesn’t account for how hard the employer’s trying.

“It could mean, ‘We have an open position, and we’re trying not very hard to fill it,’” Mui said. “Or, it could mean, ‘We have an open position, and we really, really want to fill it.’”

As a result, job openings — the JO part of the JOLTS report — might exaggerate how much labor demand there actually is. That’s a problem, Mui said, since the Federal Reserve is using that number to help decide how much to raise interest rates and slow down the job market.

“That’s taking a big risk, based on this data,” Mui said. “And if they’re wrong, and if it’s unnecessary, they’re going to unnecessarily throw a bunch of people out of work.”

Job openings aren’t the only data point the Fed is paying attention to. There are plenty of others, according to Sarah House, senior economist at Wells Fargo. And all of them are telling us that, at the end of the day, the job market is really tight.

“We’re seeing it in other measures, like the unemployment rate being historically low, as well as initial jobless claims,” House said.

House said the indicators that might give us a more accurate picture of job openings are the LT part of the JOLTS report: labor turnover. That includes a tally of the number of people voluntarily leaving their jobs.

“For every person quitting, that creates a job opening for businesses,” House said. “And so just by the sheer higher level of turnover, you are going to get more job openings.” 

Small business owner Madeline Reeves said she’s starting to rethink her hiring process. The same tools that let her advertise job openings cheaply make it really easy for a lot of applicants to apply, whether they’re qualified or not.

“It’s like you’re swimming through a sea of junk, and the process has been really draining,” Reeves said.

Reeves also isn’t sure she wants to hire anybody full time right now because she’s so unsure about the economy.

“I, as an employer, don’t necessarily want to carry that ongoing cost of payroll if I don’t have guaranteed certainty that I’ll have the work to support having people on staff,” Reeves said.  

Instead, Reeves said she’s considering other options, like hiring part-time workers, contractors or even interns.