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In October, the number of job vacancies in the United States decreased but remained high, indicating that businesses have become somewhat less desperate for workers as the Federal Reserve raises interest rates to cool the economy.
The number of job openings advertised by employers decreased from 10.7 million in September to 10.3 million in October, the Labor Department reported on Wednesday. Even with the decline, openings were somewhat lower in August, when they fell below 10.3 million before rising in September.
The number of individuals quitting their employment decreased in October, from 4,1 million to 4 million.
The Federal Reserve constantly monitors the data on job vacancies and quits for indications of the health of the labor market. The Federal Reserve is attempting to accomplish a tricky task by reducing hiring and the broader economy to reduce inflation, but without triggering a recession.
The number of available positions in construction, manufacturing, professional services such as design and engineering, and health care decreased during the last month.
AP
While more job opportunities are advantageous for job seekers, Fed officials would prefer that the number of openings decrease. This is because fewer vacancies would signal less rivalry among employers to find and retain workers, hence lessening the need to boost pay.
The number of available positions in construction, manufacturing, professional services such as design and engineering, and health care decreased during the last month. They increased in the financial services sector and stayed elevated in restaurants, bars, and hotels.
In an email, Jennifer Lee, an economist at BMO Capital Markets, stated, “The labor market is cooling (as desired by the Fed), but it is far from frigid.”
Fed policymakers would also want to see a drop in the number of people who abandon their jobs. When employees depart, it is often for a higher-paying position. Since the outbreak, workers who have changed jobs have received historically significant salary rises.
Inflation is fueled by the fact that many firms pass on rising labor expenses to consumers through pricing hikes.
The Fed would want to moderate, but not eliminate, wage growth, so it hopes that its rate rises would reduce the number of positions advertised by businesses.
On Friday, the United States will report important employment figures for November.
In an effort to combat rising inflation, the Fed has raised its benchmark interest rate six times this year to a range of 3.75 to 4 percent, the highest level in roughly 15 years. In the past year, prices have increased by 7.7%, which is close to the greatest level in the last four decades. Generally, the Fed attempts to prevent price increases by weakening the economy and increasing unemployment, which decreases expenditure and typically reduces inflation.
The Job Openings and Labor Turnover Survey report on Wednesday gives more information on the labor market than the monthly jobs report on Friday, which includes the unemployment rate and the number of jobs gained and lost each month.
»October job openings fell, a good sign for the Fed as it prepares to raise rate«