Job Openings Plunged by More Than 1 Million in August
October 5, 2022
The number of job openings plummeted by more than 1 million in August, a sign that the historically hot job market may be starting to cool.
There were 10.05 million open positions during the month, a drop of more than 10% from July’s 11.17 million, according to the Bureau of Labor Statistics’ latest Job Openings and Labor Turnover (JOLT) report. That is the biggest one-month decline since April 2020 when the Covid pandemic began and puts openings at their lowest level in more than a year.
A potential slowdown in the ultra-tight labor market will likely be welcome news to the Federal Reserve, However, even with the drop, the 10.1 million job openings in August far exceeded the 6 million unemployed people looking for work.
While this is an improvement from earlier in the year, when there were about 2 open jobs for every prospective worker, it leaves the ratio at roughly 1.67 to 1 in August. This means that workers are still in demand and have the leverage to push for higher wages, which can fuel further inflation.
The number of layoffs rose slightly in August, another sign that the labor market may be starting to cool, but workers remain confident in the labor market. The number of quits, which tracks workers who left their jobs voluntarily, jumped by 100,000 to a seasonally adjusted 4.2 million. Workers tend to only leave voluntarily if they feel certain they can secure higher wages or better benefits elsewhere, which also adds to inflationary pressure.