U.S. job openings dropped sharply to a 3.5-year low in September, with the largest impact felt in the South due to the devastating aftermath of Hurricanes Helene and Milton.
However, the disappointing report from the Labor Department on Tuesday was overshadowed by a Conference Board survey, which showed a rebound in consumer confidence and growing optimism about the job market.
Job openings fell by 418,000 from August and 1.9 million over the year to 7.443 million in September 2024, the lowest since January 2021, Reuters reported.
The latest Job Openings and Labor Turnover Survey (JOLTS) report said that hires rose to 5.56 million from 5.44 million in August 2024 and layoffs jumped to 1.83 million from 1.67 million in August. However, the hire and layoff as a percentage of overall employment remain consistent with the pre-pandemic decade, CNN reported.
Meanwhile, the recent Conference Board survey showed that consumer confidence is improving and they are optimistic about job growth.
In October, the Conference Board's Consumer Confidence Index increased to 108.7 in October from 99.2 in September. It showed a 14.2-point spike in the Present Situation Index to 138.0 and a 6.3-point increase in the Expectations Index to 89.1, which topped the 80-point mark that usually indicates recession concerns.
"Consumer confidence recorded the strongest monthly gain since March 2021, but still did not break free of the narrow range that has prevailed over the past two years," said Dana M. Peterson, Chief Economist at The Conference Board in a statement.
"In October's reading, all five components of the Index improved. Consumers' assessments of current business conditions turned positive. Views on the current availability of jobs rebounded after several months of weakness, potentially reflecting better labor market data. Compared to last month, consumers were substantially more optimistic about future business conditions and remained positive about future income. Also, for the first time since July 2023, they showed some cautious optimism about future job availability," she continued.
"October's increase in confidence was broad-based across all age groups and most income groups. In terms of age, confidence rose sharpest for consumers aged 35 to 54. On a six-month moving average basis, householders aged under 35 and those earning over $100K remained the most confident."
In addition, the proportion of consumers anticipating a recession over the next 12 months dropped to its lowest level since the question was first asked in July 2022, as did the percentage of consumers believing the economy was already in recession.
The keyword election ranked fifth in this month's survey, behind references to prices, inflation, food and groceries, indicating consumers increased focus on the economy above the politics.
Consumers' outlook of the labor marketbecame more optimistic for the first time since July 2023 as17.8% of consumers expected more jobs to be available, up from 17.1% in September.
"The labor market data are mixed, but the latest survey of consumers in October suggests the plunge in job openings at the end of September may be a red herring in terms of the story painted about economic weakness," said Christopher Rupkey, chief economist at FWDBONDS.
The decline is consistent with the 7.9 million openings predicted by economists, CNN reported.
The slowdown indicates a return to the pre-pandemic pace, as the job openings rate reflects levels seen in 2018 and 2019. After years of rapid expansion, the labor market appears to be stabilizing, suggesting a shift to a more sustainable growth trajectory.
"Decreasing or subdued job openings, quits and hiring rates last month all point to a cooler labor market compared to one year ago," Elizabeth Renter, senior economist for NerdWallet, wrote in commentary issued Tuesday. "Employers aren't bringing many folks on, and workers aren't super eager to leave the comforts of their existing roles in the current environment."
"Specifically, hires may be temporarily depressed and layoffs overstated," she wrote.
