JOLTS: Slack Slowly Showing

Bottom Line:  The Job Openings Layoffs and Turnover Survey showed lower openings as the labor market slowly slackened. We should recall that JOLTS is lagged (these are October data, and the November employment report is due Friday) but offers greater detail of labor market dynamics, many of which the Fed has been focused on in assessing labor market tightness. In October, openings were trending slowly lower, while the quit rate was inching lower. Both remain historically high (the Fed has been focused on the quit rate). And there were no signs of any increase in layoffs, though, which remain very low. Total private job openings are still over 1.6x hiring, historically very high, but that ratio is no longer accelerating and has been around these levels for most of 2022. The ratio remains very high for skilled labor, especially healthcare jobs. But it is falling, suggesting slackening, in sectors like leisure/hospitality and trade/transport/utilities. Moreover, hiring in those sectors, as well as in manufacturing and construction, has been trending lower. Openings can lag hiring as employers leave job ads up that they may never fill. Overall, the labor market remains tight, but there were signs of slackening in several segments of the economy.

Job Openings FELL by 353k in October to 10.334 million, compared with market expectations for an increase to 10.250 million. Government job openings FELL by 138k. Consequently, private sector job openings FELL by 215k. Over the past 12 months, there were 760k more job openings.Job Hires FELL by 84k in October to 6.012 million. Over the past 12 months, there were 448k more job hires. Job Separations ROSE by 18k in October to 5.683 million. Over the past 12 months, there were 169k more job separations.

The Number of Unemployed to Job openings ratio ROSE by 0.05 points from 0.54 to 0.59 and is modestly above its 12 month average of 0.55.