The number of open positions in the U.S. job market fell hard in October, suggesting the labor market is weakening into the final months of the year, which could ease wage pressures and help cool domestic inflation.
The Job Openings and Labor Turnover Survey, known as Jolts, showed that around 8.73 million positions went unfilled in October, down from the 9.55 recorded in September and market forecasts of around 9.35 million. The October total was the weakest since March 2021.
The so-called quits rate, which tracks workers leaving their jobs voluntarily – often for pay increases in other positions – held at 2.3% for a fourth consecutive month in October. The figure compares with the 3% peak it hit at the start of last year.
"The heady days of summer 2021, when people working in consumer-facing services positions just had to cross the street to a competitor business in order to find a higher wage, are over," said Ian Shepherdson of Pantheon Macroeconomics.
"We see (a 4.5% headline unemployment rate) by next spring, at which point both the quits rate and the unemployment rate would signal wage gains slowing to just 3% or so," he added. "It’s hard to imagine anyone at the Fed arguing that this is consistent with inflation remaining above 2%."
Jolts data back estimates for spring rate cut
U.S. Treasury yields extended their recent run of declines on the back of the Jolts data. Investors bet that tamer wage pressures and a weaker job market would cement the case for a springtime rate cut from the Federal Reserve.
Benchmark 10-year note yields were last seen 13 basis points lower on the session at 4.173%, while 2-year notes eased to 4.6585%.
The U.S. dollar index, which tracks the greenback against a basket of six global currencies, was marked 0.3% higher at 104.022, thanks in part to a big intra-day decline for the euro.
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The Bureau of Labor Statistics will publish its August payrolls report on Friday. Economists are looking for a net gain of 180,000 new jobs over the month, with average hourly earnings rising 4% on the year and the headline unemployment rate holding near a five-decade low of 3.9%.
Prior to Friday's jobs data, payroll processing group ADP will publish its National Employment report at 8:15 a.m. EST on Wednesday. The Labor Department follows up with weekly jobless-claims data at 8:30 a.m. on Thursday.
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