United States job openings inched higher in October, but a broad softening across key labour indicators signalled growing unease in the employment market as the Federal Reserve commenced its two-day policy meeting.
The Labor Department’s Job Openings and Labor Turnover Survey (JOLTS), released on Tuesday (Wednesday AEDT), showed vacancies rising by 12,000 to 7.67 million at the end of October.
The reading far exceeded market expectations for 7.2 million openings, aided by the inclusion of delayed September data, which had been withheld due to the 43-day federal government shutdown.
September’s openings surged by 431,000 to 7.658 million, marking the strongest monthly gain in nearly a year.
The Bureau of Labor Statistics also noted that it had temporarily suspended the use of its monthly alignment methodology for October’s preliminary estimates because of the backlog, with normal procedures set to resume when the final October numbers are published.
October’s gains were concentrated in the trade, transportation and utilities sector, which reported 239,000 vacancies, driven largely by retailers preparing for the holiday period.
Professional and business services saw 114,000 fewer openings, while accommodation and food services recorded a further decline of 33,000.
The federal government also reported 25,000 fewer vacancies.
The overall job vacancies rate held steady at 4.6%.
Hiring, however, weakened significantly. The number of hires fell by 218,000 to 5.149 million in October, with notable declines in construction, professional and business services, healthcare and social assistance, and hospitality-related industries.
The hires rate slipped from 3.4% in September to 3.2%. Layoffs edged up by 73,000 to 1.854 million, though the layoffs rate remained historically low at 1.2%.
Taken together, the September and October reports depicted what many economists describe as a “no-hire, no-fire” labour market.
The labour market stagnation reflects both a reduced supply and a moderation in demand. Immigration levels fell sharply during the final year of former President Joe Biden’s term and decreased further under President Donald Trump’s second administration, intensifying worker shortages.
At the same time, increased adoption of artificial intelligence in administrative and entry-level roles has begun to dampen hiring needs across sectors.
One of the clearest signs of labour market cooling came from the decline in voluntary resignations. The number of people quitting their jobs fell by 187,000 in October, the sharpest monthly drop since June 2023, bringing total quits to 2.941 million, its lowest level since August 2020.
The quits rate, a key indicator of worker confidence, fell to 1.8%, its weakest reading since May 2020. Reduced job hopping typically signals slower wage growth and could place pressure on household spending.
In a separate release, the NFIB Small Business Optimism Index indicated that sentiment among small firms strengthened modestly in November.
The index rose to 99.0 from 98.2 in October, surpassing expectations for a smaller gain to 98.4 and coming in above its long-term average of 98. Improved sales expectations contributed to the increase, although uncertainty among small business owners continued to rise as many delayed investment decisions.
“Although optimism increased, small business owners are still frustrated by the lack of qualified workers,” said NFIB Chief Economist Bill Dunkelberg. “Despite this, more firms still plan to create new jobs in the near future.”
