U.S. jobs shrink as labor market cools

The number of job openings in the United States fell for the third consecutive month in November, indicating that the labor market is gradually cooling, according to the U.S. Department of Labor’s Job Openings and Labor Turnover Survey (JOLTS). The number of U.S. job openings fell by 62,000 at the end of November to a total of 8.79 million reported on Wednesday, compared with a revised figure of 8.852 million in October. The small decline was smaller than economists’ expectations for 8.85 million job openings for the month.

The number of job vacancies is down from a peak of 12 million in March 2022, indicating changing labor market dynamics, and coincides with a sharp increase in interest rates by the Federal Reserve (Fed), by as much as 525 basis points from March 2022. Despite the cooling job market, the unemployment rate has remained resilient, remaining below 4%. Part of this stability is due to companies retaining employees after facing hiring challenges during the post-COVID-19 recovery.

The Federal Reserve last month kept its policy rate at a range of 5.25-5.50%, with policymakers signaling an end to two years of aggressive monetary tightening. They also hinted that borrowing costs could fall in 2024.

The strength of the labor market is an important factor in preventing a recession. A government report on Friday is expected to show nonfarm payrolls rose by 168,000 in December, a slowdown from November’s 199,000 gain. The projected number for December, while below the 12-month average of 240,000 jobs, is still higher than the estimate of 100,000 jobs per month needed to keep up with growth in the working-age population. The unemployment rate is expected to rise slightly to 3.8% in December from 3.7% in November.

Reuters contributed to this article.

This article was created and translated with the help of artificial intelligence and reviewed by an editor. For more information, please see our terms and conditions.