Job openings eased in October in early sign of a slowdown
Number of available jobs has topped 10M for over a year
Jobs report is very difficult to forecast: Chris Low
FHN Financial chief economist takes a closer look at consumer confidence falling for the second straight month on 'Making Money.'
U.S. job openings declined in October after unexpectedly surging the previous month, an early sign that the still-tight labor market is starting to lose some steam.
The Labor Department said Tuesday that there were 10.3 million job openings in October – a sharp decline from the previous month's revised reading of 10.7 million.
The number of available jobs has topped 10 million for 12 consecutive months; before the pandemic began in February 2020, the highest on record was 7.7 million.
The Federal Reserve closely watches these figures as it tries to gauge labor market tightness; the decline in openings could provide some relief for policymakers as they try to slow the economy and cool painfully high inflation.
THE FED'S WAR ON INFLATION COULD COST 1M JOBS
A large "Now Hiring" advertisement posted on the windows of the Advance Auto Parts store in Bay Shore, New York, on March 24, 2022. ((Photo by Steve Pfost/Newsday RM via Getty Images) / Getty Images)
"The number of job openings in October fell slightly from the previous month but the labor market is still too tight for central bankers," said Jeffrey Roach, chief economist at LPL Financial. "Elevated job openings during a time of an economic slowdown implies that the labor market may remain tight for quite some time."
The Fed has responded to the inflation crisis and the extremely tight labor market by raising interest rates at the fastest pace in decades. Officials approved six straight rate hikes this year, lifting the benchmark federal funds rate well into restrictive territory, and have shown no signs of pausing.
SEVERE RECESSION NEEDED TO COOL INFLATION, BANK OF AMERICA ANALYSTS SAY
Meanwhile, the number of Americans quitting their jobs held steady at 4 million, or about 2.6% of the workforce – below the high of 4.5 million recorded earlier this year, but well above the pre-pandemic level of about 3.6 million. Hiring also slowed slightly to 6 million.
Switching jobs has been a windfall for many workers over the past year, with employees seeing an average 6.7% annual wage growth rate – a marked increase from the 4.9% of workers who do not switch jobs, according to the Atlanta Fed.
Now Hiring signs are displayed in front of restaurants in Rehoboth Beach, Delaware, on March 19, 2022. ((Photo by STEFANI REYNOLDS/AFP via Getty Images) / Getty Images)
Fed Chairman Jerome Powell has conceded that higher rates could "give rise to increases in unemployment."
"We think we need to have softer labor market conditions," Powell said in September. "And if we want to set ourselves up really light the way to another period of a very strong labor market, we have got to get inflation behind us. I wish there were a painless way to do that. There isn't."
CLICK HERE TO READ MORE ON FOX BUSINESS
The data precedes the release of the more closely watched November jobs report on Friday morning, which is expected to show that employers hired 200,000 workers following a gain of 261,000 in October. The unemployment rate is expected to hold steady at 3.7%.