Quiver Quantitative - In September, U.S. job openings demonstrated unexpected vigor, climbing for a consecutive month to reach 9.6 million, thereby showcasing the sustained strength of labor demand in different sectors of the economy. This increment from the 9.5 million recorded in August outperformed the median economist estimate of 9.4 million. The surge in job openings was propelled notably by the accommodation and food services sectors. Concurrently, hiring experienced a slight uptick, and the number of layoffs receded.
Amidst this backdrop of economic data, stocks experienced an uptick and Treasuries witnessed a rally. The steady "quits rate" at 2.3% for the third month in a row, the lowest since the outset of 2021, suggests that Americans currently exhibit diminished confidence in their capacity to secure alternative employment in the prevailing market. Such steadiness in the job market has buttressed consumer expenditure, maintained unemployment rates in check, and ensured the economy remains resilient in the face of mounting interest rates and escalating prices.
Analysts keep a keen eye on the Federal Reserve's decisions, expecting interest rates to remain unchanged in the imminent meeting. Even though there's been an increase in worker supply aiding the balancing of the job market, the continued elevated demand for labor could perpetuate inflationary pressures. The JOLTS (Job Openings and Labor Turnover Survey) report provides a nuanced understanding of September's hiring trends. Despite robust payroll growth reflected in a government report, hiring remains largely stable across industries, with sectors like construction, finance, and transportation witnessing a decline.
With the monthly jobs report on the horizon, expectations are set on employers adding approximately 180,000 jobs in October and the unemployment rate remaining consistent. On a related note, recent data indicates a subdued momentum in private payrolls and a contraction in the manufacturing index, leading some experts to question the JOLTS statistics' reliability, given its modest response rate and emerging anecdotes of employers posting jobs without genuine hiring intentions.
This article was originally published on Quiver Quantitative