US job openings experienced a notable increase in October, with vacancies rising to 7.74 million, up from September's 7.37 million, as reported by the Bureau of Labor Statistics' job openings and labor turnover survey. This figure surpassed the expected consensus of 7.52 million based on a survey conducted by Bloomberg. Private sector job openings also showed an upward trend, climbing to 6.87 million in October from 6.5 million the previous month.
A significant increase was noted in professional and business services, which added 209,000 vacancies, alongside a rise of 162,000 in accommodation and food services. The October JOLTS data present a complex picture, as highlighted by Matthew Martin, Senior Economist at Oxford Economics. The discrepancy between hires and separations introduces "downside risk" to forecasts for a significant rebound in nonfarm employment for November. On Friday, expectations are set for a report from the BLS indicating that the US economy added 202,000 jobs in November, reflecting a remarkable acceleration from a modest rise of 12,000 in October. Job separations, encompassing quits and layoffs, increased to 5.26 million in October, up from 5.2 million in September, as detailed in the JOLTS report.
Quits surged to 3.33 million from 3.1 million, marking the first rise since May 2023 and reflecting a growing willingness among workers to change positions, aligned with a more optimistic perception of current and future labor conditions. Despite this uptick, the level of quits remains aligned with diminishing wage growth, a crucial factor for the Federal Reserve in achieving its inflation targets.
"We anticipate that the Federal Reserve will overlook disruptions from hurricane impacts and the Boeing strike, proceeding with a 25 basis point rate cut at the upcoming December policy meeting," noted Martin. The rise in quits was primarily driven by the accommodation and food services sector. Meanwhile, layoffs fell to 1.63 million in October, down from 1.8 million in September, largely due to reductions in durable goods manufacturing and private educational services..