US Labour Market Continues to Slow As JOLTS Jobs Keep Falling
The labour market has been keeping the US economy afloat since it has been showing resilience, while other sectors of the economy such as manufacturing have fallen into contraction. However, we have seen some cooling off in the labour market in 2023, with job opportunities heading downward, indicating a softening in labor demand. Nonetheless, they remain significantly higher than pre-coronavirus levels.
So, the JOLTS job openings report was in the focus of market participants and Federal Reserve (Fed) policy makers yesterday, providing useful insights into the labor market’s supply-demand dynamics, which will be influencing wages and inflation later this year. Once again, the trend in job opportunities continues to be bearish and move lower as we approach the end of the year (this is November’s data), as hiring slows further.
The quit rate is frequently used as an indicator of employee confidence. It declined to 2.2% from 2.3% last month (a -157K reduction), which means that the confidence to leave or change jobs is getting weaker as well.
JOLTs Job Openings for November 2023
JOLTs job openings lowest since March 2021
- JOLTs job openings for November 8.790M vs 8.850M estimate
- Prior month 8.733M revised to 8.852M. This month is the lowest since March 2021.
- Hires 3.5% vs 3.7% last month
- Separations rate 3.4% vs. 3.6% last month
- Quits 2.2% vs 2.3% last month
Details of the Job Openings from the BLS:
Job Openings:
- The number of job openings remained relatively unchanged at 8.8 million, showing a decrease from the series high of 12.0 million in March 2022.
- The job openings rate stayed steady at 5.3%.
- Specific sector changes include a decrease in job openings in transportation, warehousing, and utilities (-128,000), a decrease in federal government job openings (-58,000), and an increase in job openings in wholesale trade (+63,000).
Hires:
- Total hires decreased to 5.5 million, a reduction of 363,000 from the previous period.
- The hires rate remained relatively stable at 3.5%.
- Notable sector-specific decrease: Hires within the professional and business services sector decreased by 163,000.
Separations:
- Total separations in November decreased to 5.3 million, a drop of 292,000, with the rate remaining stable at 3.4%.
- Notable decreases in total separations were observed in professional and business services (-158,000) and educational services (-28,000).
Quits:
- Quits in November slightly decreased to 3.5 million (down by 157,000), with the rate relatively unchanged at 2.2%.
- Reductions in quits were observed in professional and business services (-77,000) and educational services (-23,000).
Layoffs and Discharges:
- Layoffs and discharges remained stable at 1.5 million, with the rate unchanged at 1.0%.
- Durable goods manufacturing saw a decrease in layoffs and discharges (-18,000).
Other Separations:
- Other separations remained relatively unchanged at 342,000 in November.
Overall, the data indicates a mixed picture in the labor market, with stability in some metrics, decreases in others, and sector-specific variations. The dynamics of job openings, hires, and separations provide insights into the health and trends within the U.S. labor market.
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