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Key Takeaways
- Employers had 7.7 million job openings in October, more than economists were expecting and higher than August’s total of 7.2 million.
- However, layoffs also increased to their highest levels since 2023, while the hiring rate dropped to levels rarely seen since the Great Recession.
- The data isn’t expected to derail an expected interest rate cut from the Federal Reserve Wednesday, as economists point to continued weakness in the labor market.
The U.S. labor is continuing to cool, but it’s not crashing.
Today’s Job Openings and Labor Turnover Survey (JOLTS) report had mixed messages for economists. October job openings were up slightly since the last report before the government shutdown, however layoffs also inched higher to hit their highest levels in more than two years.
“The latest figures reiterate that the US labor market is not collapsing, offering investors and consumers alike a bit of relief,” wrote Bret Kenwell, eToro U.S. investment analyst. “The October jobs openings hit their highest level since January, but notably, layoffs hit a multi-year high.”
Why This Matters for the Economy
American corporations are playing defense, hiring cautiously, but not panicking. The health of the labor market has a direct influence on consumer confidence and spending, which drives overall economic growth. When hiring slows or layoffs rise, the risk of economic slowdown or recession grows.
In October, job openings came in at 7.7 million, an increase from 7.2 million job openings reported in the August release of JOLTS Job Openings and Labor Turnover Survey (JOLTS). September data wasn’t released due to the government shutdown, but the October report showed that job openings in the prior month were also near 7.7 million.
Economists surveyed by The Wall Street Journal and Dow Jones Newswires projected that job openings would remain near August levels of 7.2 million. The data shouldn’t impact the direction of the Federal Reserve, which is likely to announce an interest rate cut when it concludes its regular meeting on Wednesday, given officials’ increasing concerns about the health of the labor market.
Layoffs Climb as Fewer Workers Leave Voluntarily
The Bureau of Labor Statistics data showed that total separations in October fell to around 5.05 million, down from September and August levels. A total of 2.9 million workers quit their jobs in October, down from the 3.1 million quits in the prior month, indicating that fewer workers are willing or able to leave their jobs. Meanwhile, layoffs totaled 1.9 million, the highest since January 2023.
“Overall, the pace of layoffs remains controlled and doesn’t signal a break in the labor market. Meanwhile, a new multi-year low in the quits rate shows decreasing confidence in the job market,” wrote Oren Klachkin, Nationwide financial market economist.
Employers hired 5.1 million workers in October, with a hiring rate of 3.2%, one of the lowest rates since the Great Recession, according to Heather Long, chief economist at Navy Federal Credit Union.
“To anyone job hunting, this economy feels Grinch-like,” she wrote. “While it’s encouraging that job openings ticked up in October, it’s hard to get too excited until firms start hiring people.”
