Developing story. Check back for updates.
The numbers: Job openings in the U.S. fell in October to a 28-month low of 8.7 million, adding further evidence that the labor market is cooling off in response to higher interest rates.
Job listings sank from a revised 9.4 million in September, the Labor Department said Tuesday.
The number of job openings is seen as a sign of the health of the labor market and the broader economy. Economists polled by the Wall Street Journal had forecast job listings to total 9.4 million.
Although there’s still lots of job openings, they have declined steadily from a record 12 million in 2022 and point to a softening labor market.
The Federal Reserve views a declining number of openings as evidence that higher interest rates are slowing the economy and easing the demand for labor. That could help relieve the upward pressure on wages and make it easier for the central bank to reduce inflation to its 2% annual goal.
The number of people quitting jobs, meanwhile, was barely changed at 3.6 million.
Job quitters had climbed to as high as 4.5 million last year before ebbing. People tend to stay in their current jobs when the economy weakens and jobs become harder to find.
Key details: Job openings fell the most in health care, finance, real estate, retail and hospitality — the parts of the economy in which hiring had been strongest.
Professional businesses and Information services were the only industries to post notable increases in job openings.
While many openings are never actually filled, economists view the trend in job postings as a rough gauge of how strong the labor market is.
The number of job openings for each unemployed worker dropped again to 1.3 last month from 1.5 in September,
The ratio is down from a peak of 2.0 in 2022 and almost back to a pre-pandemic norms of around 1.2 or so. Fed officials had been watching the ratio closely as a gauge of labor-market strength.
The so-called quits rate among private-sector workers, meanwhile, was unchanged at 2.6% and back to pre-pandemic levels.
The U.S. is forecast to add a 190,000 new jobs in November. The jobs report comes out on Friday.
The economy added a modest 150,000 new jobs in October to mark the second smallest gain since 2021.
Big picture: The labor market has lot some of its sizzle and is likely to cool off even further. That’s good news for the Fed as it aims to tame inflation without triggering a recession.
The central bank is widely expected to leave interest unchanged at its next big meeting in a week.
Market reaction: The Dow Jones Industrial Average
DJIA
and S&P 500
SPX
fell in Tuesday trades.
Source link
