With the labor market slowing, workers are becoming increasingly cautious about finding new jobs.
The turnover rate, a measure of worker confidence, fell to 1.9% in August from 2% in July, the lowest rate since June 2020, according to new data from the Bureau of Labor Statistics released Wednesday. It was a slow pace. According to the survey (JOLTS), the number of employed people in the same month was 5.31 million, down from 5.41 people in July. The hiring rate in August was 3.3%, down from 3.4% in July. Excluding the pandemic, hiring rates in August were the lowest since 2013.
“Unemployment rates have fallen to their lowest since the pandemic, and this decline is a sign that workers view the labor market as less favorable,” Nancy Vanden Houten, chief economist at Oxford Economics, said in a note to clients on Tuesday. “This is consistent with other data showing that.”
The report offered some mixed signals, highlighting how the labor market has cooled but is not slowing down quickly, as job openings in August were higher than expected. The number of job openings in August was 8.04 million as of the end of August, up from 7.71 million in July. Economists surveyed by Bloomberg expected the report to show a slight increase in job openings in August to 7.67 million.
Vanden Houten said the generally weak JOLTS report tilts the risk that the Fed will cut rates by 50 basis points at its November meeting amid a slowing economy, but a significant rate cut is still warranted. He insisted that it would not be done.
The announcement comes less than two weeks after the Federal Reserve cut interest rates for the first time in more than four years. Federal Reserve Chairman Jerome Powell said the U.S. economy is “robust” and the Fed is cutting interest rates to keep it that way.
Chairman Powell said, “The U.S. economy is in good shape.” “We’re growing at a solid pace. Inflation is falling. The labor market is in good shape. We want to keep it that way. That’s what we’re doing.” [by cutting interest rates]. ”
Further updates on the health of the labor market are expected later this week, led by Friday’s release of the September jobs report. Economists expect the report to show that the U.S. economy will add 130,000 nonfarm jobs and the unemployment rate will remain steady at 4.2%, according to Bloomberg data. The US economy added 142,000 jobs in August, and the unemployment rate fell to 4.2%.
A “Help Wanted” sign in a window advertising a job opening at a dry cleaners in Boston, Massachusetts, on September 1, 2010. Reuters/Brian Snyder (USA – Tag: Corporate Employment) (Reuters/Reuters)
Josh Schafer is a reporter for Yahoo Finance. Follow him on X @_joshschafer.
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