US job openings experienced a significant increase in November, reaching the highest level seen in six months, while the number of layoffs rose slightly. According to government data released, vacancies rose to 8.1 million as of the end of November, up from an upwardly revised 7.84 million in October based on the Bureau of Labor Statistics' Job Openings and Labor Turnover Survey (JOLTS).
This increase exceeded the consensus expectation of 7.74 million, as reported in a Bloomberg survey. Notably, the extent of job vacancies in November marked the highest level since May. The data revealed that total private job openings climbed to 7.21 million in November, compared to just under 7 million the previous month.
An analysis of the BLS data indicates that vacancies increased by 273,000 in professional and business services and by 105,000 in finance and insurance sectors. In contrast, there was a decline of 89,000 vacancies in the information sector. In terms of hiring, the figures showed a cooling trend, with hires decreasing to 5.27 million in November from 5.39 million the month prior.
Job separations, which include both quits and layoffs, dipped slightly to 5.13 million in November, down from 5.31 million in October, as noted in the JOLTS report. Notably, the number of quits fell to 3.07 million from the previous month's 3.28 million, while layoffs and discharges edged up to 1.77 million from 1.75 million. According to TS Lombard, 'Hiring is down but layoffs have yet to pop.' This statement underscores a historically observed pattern where reduced hiring often precedes a more active approach to workforce reduction, as opposed to a gradual decrease through attrition, which is indicative of the current economic climate.
Markets are looking ahead as, on Friday, the BLS is expected to report that the US economy added 154,000 nonfarm jobs in December, a decline from the 227,000 gain reported in November. Analysts point out that 'We will see Friday about the December labor market, but the (November) JOLTS data underscore the (Federal Reserve's) concerns about not allowing the demand for labor to cool further.' The decline in quits was particularly noted in the accommodation and food services sectors, which are critical as they tend to drive layoffs, according to the government figures..