Hiring, Job Openings Fall in October in Labor Sector Slowdown

 By Mark Lieberman

Managing Director and Senior Economist

Highlights:

  • Hiring FELL in October, dropping to the lowest level since May;
  • Job openings at the end of October DECLINED for only the third time this year;
  • The ratio of unemployed to job opening WAS UNCHANGED in October at 1.41. still down sharply from the Recession peak of 6.48 in November 2009
  • The number of job openings FELL in October in construction, manufacturing and information sectors.

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The labor picture dimmed in October as both hiring and job openings declined, data picked up in the Employment Situation release, according to the Bureau of Labor Statistics’ monthly Job Openings and Labor Turnover Survey (JOLTS).

Matching the two reports, which together track the labor market, showed unemployment increased in the construction, manufacturing and trade sectors

The report, which tracks the ins and outs of the labor market (while the Employment Situation report provides a snapshot) appeared to contradict suggestions of a new robustness in the labor market. Indeed, last week’s Employment Situation release (for November) was the third report in the last four to show jobs gains of less than 200,000 – far below the number of jobs necessary to accommodate the increase in the over-16, working age, population.

That the number of job openings fell in October, is consistent with the weaker job growth in November.

That said, even though hiring slipped in October (when the Employment Situation release noted an increase of 142,000 – the smallest increase since May) the nation’s economy is still on track for an overall 62.37 million hires in 2016 which would be 1.05 percent more than in 2015 and the largest total since 2006, the year before the Recession.

At the same time, the number of separations is on track to hit 60.05 million this year increase in the number of job openings – up 1.8 percent from 2015.

The number of “quits,” a signal of worker confidence in the ability to find a new job, dipped slightly to 2.99 million in October and is on track to hit 35.5 million for the full year, up 6.2 percent from 2015.

The JOLTS report, based on the number of openings by industry offered some hints as to sectors which might be expanding, among them education and health services, financial services and government. The number of government jobs indeed increased by 22,000 according to last week’s jobs report for October.

You can hear Mark Lieberman on P.O.T.U.S Morning Briefing (Sirius 124) every Friday at 6:20 am Eastern Time. Follow him on Twitter at @foxeconomics.

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