The number of job openings in the United States edged down ever so slightly in October in a welcome and rare sign that the labor market may finally be coming off the boil. At the same time, the unemployment level climbed by more than 300,000 people, further easing the surplus demand that has shaped the U.S. labor market since the early summer of 2021.
With more than 10.3 million job openings and 6.1 million unemployed, there’s still 1.7 unfilled positions for every job seeker, however, indicating that the imbalance between labor demand and supply persists, albeit at a slightly lower level. Before the pandemic hit in March 2020, there had been 1.2 job openings per unemployed person in an already tight labor market. That indicator then crashed to 0.2 by April 2020 amid mass layoffs in sectors affected by Covid restrictions before climbing as high as 2.0 job openings per unemployed person by March 2022, at the height of the Great Resignation.
Fed Chair Jerome Powell has repeatedly stressed that the labor market needs to come off the boil to relieve upward pressure on wages and thus cool inflation, a goal that has proven elusive so far. The latest reading, while pointing in the right direction, won’t be enough for the Fed to change course on future rate hikes.
This chart shows the number of unemployed persons and job openings in the United States.
