Job Openings Fall Below Analyst Expectations in December
New data from the Bureau of Labor Statistics reveals a decline in job openings at the end of December, reaching their lowest point since September. The total number of open positions stood at 7.6 million, down from 8.15 million in November, marking the largest sequential drop since October 2023.
Economists had anticipated around 8 million openings, undershooting the actual figure. Despite a slowdown in hiring, the low pace of layoffs has kept net job growth positive, according to Nancy Vanden Houten, lead US economist at Oxford Economics.
The Job Openings and Labor Turnover Survey (JOLTS) also indicated an increase in hires during December, with 5.46 million positions filled compared to 5.37 million in November. Notably, the hiring rate remained at 3.4% for the third consecutive month.
The quits rate, an indicator of worker confidence, stayed unchanged at 2% in December. However, both quits and hiring rates remain below pre-pandemic levels.
Fed Chair Jerome Powell has previously characterized the labor market as "broadly stable," citing the low layoffs and modest hiring pace as factors supporting a pause in interest rate cuts. Vanden Houten suggests that the December JOLTS report aligns with the Fed's assessment.
Markets currently anticipate less than a 50% probability of a rate cut until at least the June meeting, according to the CME FedWatch Tool.
This week's labor market data is closely watched by investors, with the January jobs report expected on Friday. Economists predict a slowdown in job growth from 256,000 in December to 170,000 in January, while the unemployment rate is likely to remain at 4.1%. Revisions to labor data from the past year will also be included in the report.