Job openings rose more than economists expected in November, but other signs of cooling in the labor market emerged as fewer Americans left their jobs and hiring continued to slow.
New data from the Bureau of Labor Statistics released Tuesday showed there were 8.1 million jobs open at the end of November, an increase from the 7.84 million seen in October and the highest level of job openings since May 2023.
The October figure was revised higher from the 7.74 million open jobs initially reported. Economists surveyed by Bloomberg had expected Tuesday’s report to show 7.74 million openings in November.
The Job Openings and Labor Turnover Survey (JOLTS) also showed 5.27 million hires were made during the month, down from the 5.39 million made during October. The hiring rate fell to 3.3% from the 3.4% seen in October. Also in Tuesday’s report, the quits rate, a sign of confidence among workers, fell to 1.9% from 2.1% in October.
Oxford Economics lead US economist Nancy Vanden Houten described Tuesday’s release as consistent with a “no hire, no fire” labor market.
The quits rate and hiring rate are now lower than they were before pandemic. These signs of slowing in the labor market have prompted Fed Chair Jerome Powell to describe the labor market as “looser than pre-pandemic.” But he also noted that, for now, the labor market is cooling in a “gradual and orderly way.”
“We don’t think we need further cooling in the labor market to get inflation down to 2%,” Powell said.
Wells Fargo senior economist Sarah House wrote in a note to clients that while the labor market has clearly shown an overall deceleration, it hasn’t proved to be “a [non-linear] deterioration.” This, House said, helps explain why the Fed has reiterated it will be taking a gradual approach to interest rate cuts in 2025 while it waits for further progress on inflation.
“Hiring may be easing up, but it is not collapsing,” House wrote. “And while businesses are not looking for as many workers as they were a year or two ago, they are not laying off workers in droves either.”
A broader update on the state of the jobs market in the US will come on Friday with the December jobs report. Consensus expects the US economy added 163,000 jobs in December, down from the 227,000 additions seen in November. Meanwhile, the unemployment rate is projected to hold steady at 4.2%.
