WASHINGTON — U.S. job openings dropped to more than a 3-1/2-year low in September, but nearly all the decline in vacancies was in the South, suggesting that Hurricanes Helene and Milton had temporarily weighed on demand for labor.
The downbeat report from the Labor Department on Tuesday was countered by a Conference Board survey showing consumers’ perceptions of the jobs market improved considerably in October, helping to lift consumer confidence to a nine-month high.
The hurricanes and strikes by factory workers in the aerospace industry are expected to have temporarily curbed job growth in October. Economists argue that the labor market picture has not changed materially since the surge in payroll gains in September.
“The labor market data are mixed, but the latest survey of consumers in October suggests the plunge in job openings at the end of September may be a red herring in terms of the story painted about economic weakness,” said Christopher Rupkey, chief economist at FWDBONDS.
Job openings, a measure of labor demand, were down by 418,000 to 7.443 million by the last day of September, the lowest level since January 2021, the Labor Department’s Bureau of Labor Statistics said in its Job Openings and Labor Turnover Survey, or JOLTS report.
Data for August was revised down to show 7.861 million unfilled positions instead of the previously reported 8.040 million. Economists polled by Reuters had forecast 8.00 million job openings. There were 1.09 jobs for every unemployed person, little changed from 1.10 in August.
Vacancies plunged by 325,000 in the U.S. South, large parts of which were devastated by Helene and Milton. Job openings in the West, East and Northeast fell marginally.
Unfilled positions on a national basis decreased by 178,000 in the health care and social assistance sector. State and local government, excluding education, had 79,000 fewer vacancies while open positions in the federal government dropped 28,000. But job openings increased by 85,000 in the finance and insurance sector
The job openings rate fell to 4.5%, the lowest level since December 2020, from 4.7% in August. Hires increased by 123,000 to 5.558 million, lifted by the manufacturing, retail as well as healthcare and social assistance industries. The hires rate rose to 3.5% from 3.4% in August.
Layoffs advanced by 165,000 to 1.833 million. They were driven by the manufacturing, professional and business services as well as accommodation and food services sectors. The layoffs rate rose to 1.2%, the highest level since March 2023, from 1.0% in August. Fewer people quit their jobs, pushing the quits rate to 1.9% from 2.0% in the prior month.
That was the lowest level in the quits rate since June 2020, suggesting wage pressures would continue to subside and allow the Federal Reserve to continue cutting interest rates.
Stocks on Wall Street were mixed. The dollar advanced against a basket of currencies. U.S. Treasury yields rose.
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NOISY LABOR DATA
Nonfarm payrolls are expected to have increased by 115,000 jobs in October after a rise of 254,000 in September, a Reuters survey of economists showed. That would be the smallest count in six months. The unemployment rate is forecast to be unchanged at 4.1%.
The U.S. central bank is expected to cut interest rates by 25 basis points at its meeting next month after kicking off its easing cycle with an unusually large half-percentage-point cut in September.
That reduction in borrowing costs, the first since 2020, lowered the Fed’s policy rate to the 4.75%-5.00% range. It hiked rates by 525 basis points in 2022 and 2023 to curb inflation.
In a separate report on Tuesday, the Conference Board said consumer confidence increased to a nine-month high in October amid improved perceptions of the labor market. Consumers were little worried about the Nov. 5 U.S. election.
The share of consumers who viewed jobs as being “plentiful” rose to 35.1% from 31.3% in September. Some 16.8% of consumers said jobs were “hard to get,” down from 18.6% last month.
The survey’s so-called labor market differential, derived from data on respondents’ views on whether jobs are plentiful or hard to get, increased to 18.3 from 12.7 in September. This measure correlates to the unemployment rate in the Labor Department’s monthly employment report.