U.S. vacancies jump to 11 million; fewer workers quitting voluntarily

A restaurant advertising jobs appears to be attracting workers in Oceanside, California, USA, May 10, 2021. REUTERS / Mike Blake / File Photo

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  • The number of vacancies will increase by 431,000 to 11 million in October
  • Rental falls 82,000; ending decline 205,000

WASHINGTON, December 8 (Reuters) – The number of vacancies in the United States increased in October as employment declined, indicating a worsening shortage of workers, which could hamper employment growth and the general economy.

The Ministry of Labor’s monthly job opening and employment turnover survey, or JOLTS report, on Wednesday also showed a steady decline in redundancies, another sign that the labor market has tightened. While the number of people who voluntarily left the job fell, it remained quite high.

“Under normal circumstances, an almost record number of job openings will be worth celebrating,” said Jennifer Lee, a senior economist at BMO Capital Markets in Toronto. “But no employers are in a party mood. It is difficult to fill orders or meet customer requirements if there are not enough people to do the job itself.”

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Job openings, a measure of labor demand, increased by 431,000 to 11.0 million on the last day of October. This was the second highest recorded. Economists asked by Reuters had predicted 10.4 million vacancies.

The increase was led by the accommodation and food industry, where vacancies increased by 254,000 jobs. There were 45,000 vacancies in the durable goods industry, while vacancies increased by 42,000 in the education services sector. However, vacancies fell by 115,000 in state and local governments, excluding education.

Regionally, the increase in vacancies was more pronounced in the south, with moderate increases in the west and midwest. Vacancies fell in the northeast. The number of vacancies rose to 6.9% from 6.7% in September.

Employment fell by 82,000 jobs to 6.5 million in October. The finance and insurance industry accounted for the decline, with a decrease of 96,000 in salary. However, there were increases in employment in education services as well as state and municipal education. The employment rate was unchanged at 4.4%.

There were about 1.5 vacancies per unemployed person in October.

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The government reported last Friday that wage lists outside agriculture increased by 210,000 jobs in November, the fewest since December last year, after increasing by 546,000 in October. Unemployment fell to a 21-month low of 4.2%. read more

Although employment is 3.9 million jobs below the peak in February 2020, economists believe that the figure is probably not a true reflection of the health of the labor market, as the deficit includes people who have retired.

The JOLTS report showed that layoffs fell by 35,000 to 1,361 million. The redundancy rate was unchanged at 0.9% for the third month in a row.

Departures were reduced by 205,000 to a still high 4 million in October. The decline was in several industries, with large declines in transport, warehousing and supplies as well as finance and insurance, and arts, entertainment and recreation.

But 21,000 more people quit their jobs in state and local governments, excluding education. There were also several endings in mining and logging. The closure rate fell to 2.8% from 3.0% in September, amid a large drop in the leisure and hospitality sector.

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“The outage rate in these industries fell by half a percentage point, signaling some relief in job hopping,” said Nick Bunker, research director at Indeed Hiring Lab. “In addition to the decline in wage growth in the sector seen in recent job reports, this trend suggests that the favorable situation for workers in this sector may worsen in the months ahead if the current situation continues.”

The interruption rate is normally seen by decision-makers and economists as a measure of confidence in the labor market. The still high final rate suggests that wage growth is likely to remain uncomfortably high for some time. Inflation is well above the Federal Reserve’s flexible 2% target.

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Reporting by Lucia Mutikani; Edited by Andrea Ricci

Our standards: Thomson Reuters Trust Principles.

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