Employment vacancies and employees quitting their jobs unexpectedly rose in October as new data indicate that the U.S. labor market is improving.
The number of job openings surged by 372,000 to 7.74 million, according to the Bureau of Labor Statistics’ latest Job Openings and Labor Turnover Summary (JOLTS) report.
This was up from the September reading of 7.37 million, revised down from 7.44 million.
Job vacancies increased in professional and business services (209,000), accommodation and food services (162,000), and information (87,000).
The only sizable decline was observed in the federal government, with job openings tumbling by 26,000.
Markets had expected 7.48 million job vacancies in October.
While they have decreased from their peak of more than 12 million in 2022, job openings remain above pre-pandemic levels.
JOLTS data showed that job resignations jumped by 228,000 to 3.326 million, the highest in five months. In the previous month, job quits totaled 3.09 million.
Resignations were mostly concentrated in accommodation and food services (90,000) and private education and health services (47,000).
They fell in retail trade (negative 26,000), finance and insurance (negative 19,000), and government (negative 2,000).
The quitting rate—a gauge of voluntary job leavers as a percentage of total employment—rose to 2.1 percent from 1.9 percent.
Economists monitor this statistic since it can signal how confident workers are that they can resign from their current positions and find a new job.
The number of hires was flat in October, though the figure is down by more than 500,000 from a year ago to 5.3 million.
The hiring rate was little changed at 3.3 percent.
Layoffs slipped by 169,000 to 1.63 million.
The ratio of openings to unemployed—a preferred metric for the Federal Reserve—has dipped from the 2022 highs and has returned to pre-crisis levels.
October’s snapshot of the U.S. labor market was mixed but still appears intact, says Mark Hamrick, senior economic analyst at Bankrate.
“Broadly, the job market has cooled but is still considered healthy,” Hamrick said in a statement shared with The Epoch Times.
JOLTS was the first labor-related data print of the week’s flurry of job numbers.
The November jobs report, which will be released on Dec. 6, will be the main event.
The consensus forecast suggests 200,000 new positions and a slightly higher unemployment rate of 4.2 percent.
“The forthcoming November reading from the Labor Department should look more normal after a lackluster October report,” Hamrick said.
The U.S. economy added just 12,000 new jobs in October, the worst report since December 2020.
Labor Market Views
Policymakers, economic observers, and the public have expressed differing views about the national labor market.“November’s increase was mainly driven by more positive consumer assessments of the present situation, particularly regarding the labor market,” Dana M. Peterson, chief economist at The Conference Board, said in the report.
“Compared to October, consumers were also substantially more optimistic about future job availability, which reached its highest level in almost three years.”
Consumers’ expectations about future business conditions were little changed due to growing pessimism about future income, Peterson noted.
Nominal (non-inflation-adjusted) average hourly earnings have gradually eased since the 2022 peak of 5.9 percent, sliding to 4 percent in October.
For the second consecutive month, the median one-year outlook for expected earnings growth was unchanged at 2.8 percent in October.
However, the mean probability of finding employment in the next three months if a position were lost today climbed to a one-year high of 56 percent.
Monetary authorities have presented different labor market assessments.
Richmond Fed President Tom Barkin suggested the labor market might require further monitoring as job growth has slowed.
Market Reaction
Financial markets had little reaction to the JOLTS, with the leading benchmark indexes struggling for direction during the Dec. 3 trading session.U.S. Treasury yields were mixed as the benchmark 10-year yield picked up modest gains and traded above 4.2 percent.
The U.S. dollar index, a measure of the greenback against a weighted basket of currencies, dipped below 106.4.
Tom Essaye, the founder and president of the Sevens Report, says the end-of-week jobs report could move Treasury markets.
“The data this week, especially Friday’s jobs report, does have the potential to move Treasury markets if it’s ‘Too Hot’ [yields higher] or ‘Too Cold’ [yields lower] and ‘calm’ in the Treasury yield remains the near-term, best-case scenario for stocks right now,” Essaye said in a note emailed to The Epoch Times.
Employment data, be it JOLTS or the November jobs report, could also weigh on the Fed’s next policy decision.
“The Fed’s Dec. 18 decision will be a close one, but if the majority of voting members prioritize the employment mandate, markets should expect a cut in policy rates, supporting risk appetite,” Jeffrey Roach, chief economist at LPL Financial, said in a note emailed to The Epoch Times.
