https://www.cnbc.com/2023/03/08/job-openings-declined-in-january-but-still-far-outnumber-available-workers.html
The Labor Department's Job Openings and Labor Turnover Survey (JOLTS) has shown that there exist 10.824 million job openings, down by about 410,000 from December of 2022, with 1.9 job openings per available worker, with a total gap of 5.13 million between workers and job openings.
The JOLTS report further stated that hiring was brisk for the month, with employers bringing on 6.37 million workers, the highest total since August. The payroll processing form ADP reported that companies added 244,000 workers for February, despite Fed rate hikes.
Federal reserve officials take the JOLTS report closely as they formulate monetary policy, with Jerome Powell calling the jobs market "extremely tight," and cautioned that recent data showing resurgent inflationary pressures could push interest rates higher.
Total separations didn't experience much change, but quits, a signal of worker confidence in mobility fell to 3.88 million, which is the lowest since May 2021. layoffs rose up sharply, up 241,000, or 16%
There existed some other signs of softness in the job market, however, with construction openings falling by 49% (240,000), with an additional 16000 jobs being lost in February. The Leisure and Hospitality sector also saw a decline of 194,000 in January.
According to the article, the markets will gain a more comprehensive overview of the jobs market with the Labor department's nonfarm payroll report released on Friday, but economists surveyed by Dow Jones expect payrolls to increase by 225,000, with unemployment remaining constant at 3.4%
5 comments:
The article provides valuable information about the state of the job market and is a critical tool for policymakers at the Federal Reserve. The fact that there are over 10 million job openings in the US is an encouraging sign that employers are looking to hire and are optimistic about the economy. The report highlighting that hiring has been brisk, with employers adding the highest number of workers since August, suggests that businesses are confident about their prospects and are willing to invest in their workforce. Despite the Federal Reserve's recent rate hikes, companies added 244,000 workers in February, indicating that businesses are not overly concerned about borrowing costs. This suggests that the economy is strong enough to absorb rate hikes without decreasing job growth.
The current job market in the US has a lot of job openings, which could be good news for international students who want to work in the US after graduation. However, it might be more competitive for them to find a job. If inflation leads to higher interest rates, it could make it harder for businesses to hire new employees, which could affect international students seeking employment.
Despite the continually tight labor market as of right now, it appears that the interest rate increases by the Federal Reserve are reflecting the expected outcome of increasing unemployment. I recognize that this article predicts a constant unemployment rate of 3.4%, but the lower number of Job Openings and an increase in layoffs stands to reason that we are headed in the right direction. That being said, the goal of higher unemployment has not been achieved and I do suspect that the Federal Reserve will continue to increase interest rates. I am curious to see how the SVB collapse and decrease in stock value will impact the number of layoffs that will occur this month.
The amount of job openings in the US is great, but I think that there are so many openings due to the expectations of work hours and salary of workers. Workers are choosing to be frictional and want a higher salary due to the increase in cost of living. Wages have risen over the last few years but, REAL wages have not as inflation has made salaries feel lower and lower. I am curious to see how future layoffs change wages.
Hello Digvijay,
It is true that the amount of job layoffs have increased in America and it could be a precaution to slow down inflation. Many employers are now struggling to pay all their workers these new higher wages, and they are unable to cut wages unless everyone agrees. This is a very unlikely outcome, so it is easiest to just let certain employees go so they can stay afloat. Another reason for these layoffs is that inflation has caused companies to cut all extra costs, and unfortunately that is through employee cuts because it is hard for employers to change their products and material. Customers would not like that.
Overall, good post. Well done.
Post a Comment