US Job Openings Fall in January, Construction Sees Largest Decline Ahead of February Jobs Report
The number of job openings in the United States fell to 10.8 million in January, down from an upwardly revised 11.2 million in December, according to the U.S. Bureau of Labor Statistics.[0] This release provides estimates of the quantity and rate of job openings, hires, and separations for the entire nonfarm sector, by industry, and by the size of the establishment.[1]
The construction industry reported the largest pullback in job openings, with 248,000 jobs in January, a decrease of 240,000 from December.[2] This plunge shows that construction jobs are evaporating as old projects come to a close and aren’t being replaced by new ones, while soaring mortgage rates have led to a dramatic pullback in home sales.[3]
The number of employees quitting their jobs fell slightly to 3.9 million from 4.1 million the prior month, a historically elevated figure but the lowest level since May 2021.[1] The rate of voluntary job departures dropped from 2.6% to 2.5%, typically due to workers securing higher-paying positions.[4]
The US Federal Reserve is monitoring the labor market closely, aiming to reduce the high levels of inflation.[5] The tight labor market has not been the primary factor for the current inflation, however, it has raised the alarm among Federal Reserve officials that the wage negotiations might result in a rise in inflation.[6]
This Friday, the February jobs report will be the focus of attention, with economists forecasting a decline from January and investors eagerly analyzing what the figures imply for the Federal Reserve's upcoming decision on interest rates.[7] The report is expected to show employers added 203,000 jobs in February, with a steady unemployment rate of 3.4%.[8] It is predicted that hourly wages will increase by an average of 0.4%, or a total of 4.8%, on an[9]
Wall Street economists expect the Fed to continue raising rates at a quarter-point pace, but a slew of hotter-than-expected economic data reports in recent weeks — including the blowout January jobs report and disappointing inflation data that pointed to the pervasiveness of high consumer prices — has raised the specter of a higher peak rate or steeper increases.[10]
Despite the Federal Reserve's attempts to slow economic growth, employers are still having difficulty finding personnel due to the constricted labor market, which has resulted in higher wages.[9] The JOLTS report for January revealed an increase in hiring, from 6.25 million to 6.37 million, while layoffs saw a surge to 1.[6]
0. “ABC: Construction Job Openings Plummet by a Shocking 240,000 in January | News Releases” Associated Builders and Contractors, 8 Mar. 2023, https://www.abc.org/News-Media/News-Releases/entryid/19847/abc-construction-job-openings-plummet-by-a-shocking-240000-in-january
1. “Job Openings and Labor Turnover – January 2023” Forex Factory, 8 Mar. 2023, https://www.forexfactory.com/news/1209582-job-openings-and-labor-turnover-january-2023
2. “U.S. job openings dipped in January” Axios, 9 Mar. 2023, https://www.axios.com/2023/03/08/january-job-report-openings-layoffs
3. “‘Shocking' plunge in construction job openings as Fed rate hikes begin to sting” Washington Examiner, 8 Mar. 2023, https://www.washingtonexaminer.com/policy/economy/construction-job-openings-fall-interest-rates
4. “Job openings fell to 10.8M in January in sign labor market is cooling” USA TODAY, 8 Mar. 2023, https://www.usatoday.com/story/money/2023/03/08/job-openings-january-labor-market/11422256002
5. “Job openings dipped in January but remain historically high” Fox Business, 8 Mar. 2023, https://www.foxbusiness.com/economy/job-openings-dipped-january-remain-historically-high
6. “The number of available jobs in the US shrank in January” CNN, 8 Mar. 2023, https://www.cnn.com/2023/03/08/economy/job-openings-layoffs-jolts-january/index.html
7. “Jobs Friday Is Here. What to Expect From the Report Today.” Barron's, 10 Mar. 2023, https://www.barrons.com/articles/february-jobs-report-today-39762ac
8. “Strong jobs report could trigger big Fed rate hike in March: Barclays” Markets Insider, 8 Mar. 2023, https://markets.businessinsider.com/news/stocks/interest-rates-stocks-jobs-report-economy-fed-february-powell-markets-2023-3
9. “February is expected to have been a strong month for hiring and wage growth” CNBC, 9 Mar. 2023, https://www.cnbc.com/2023/03/09/february-is-expected-to-have-been-a-strong-month-for-hiring-and-wages.html
10. “Why Friday's Jobs Report Won't Save The S&P 500 From Fed Hawks” Investor's Business Daily, 9 Mar. 2023, https://www.investors.com/news/economy/why-a-soft-jobs-report-wont-save-the-sp-500-from-fed-hawks/
