Job gives fell greater than anticipated

An employee hiring sign with a QR code is seen in a window of a company in Arlington, Virginia, April 7, 2023.

Elisabeth Franz | Reuters

Job listings continued to fall in March, hitting a near two-year low in a sign that the ultra-strained US job market is loosening and may put less pressure on inflation, the Labor Department reported on Tuesday.

The department’s vacancies and labor turnover survey showed the number of job vacancies for the month totaled 9.59 million, compared with 9.97 million in February and below the FactSet estimate of 9.64 million.

At the same time, layoffs and layoffs rose by 248,000 to just over 1.8 million, taking the rate as a percentage of the workforce from 1% to 1.2%.

Though the record lags a month behind nonfarm payroll counts, the Federal Reserve is watching the JOLTS report closely for signs of labor shortages. A lower number is positive for inflation as it indicates less pressure on wages and could reduce pressure on the Fed to raise interest rates further.

However, shares fell following the release with the Dow Jones industry average Shed more than 500 points during the session as investors remained concerned about the state of the economy and news that the US may hit its borrowing limit sooner than expected.

At the same time, a separate Commerce Department report showed that orders for manufactured goods rose 0.9% in March, down from the 1.3% estimate.

The number of vacancies was the lowest total since April 2021, bringing the vacancies-to-available-worker ratio down to 1.6-to-1 after hovering around 2-to-1 for most of the past two years.

“The Fed should gain some comfort from the gradual decline in this ratio, but they will also likely take this data as confirmation of the need for another rate hike tomorrow,” said Ronald Temple, chief markets strategist at Lazard.

Layoffs, which are taken as a measure of workers’ confidence in their ability to leave one’s job and find another, fell by 129,000 to 3.85 million, the lowest since May 2021 amid the so-called Big Resignation.

New hires for the month were flat at 6.15 million, while separations rose slightly.

The release comes as the central bank began its two-day monetary policy meeting on Tuesday. Markets rate a nearly 100% chance that the central bank will announce a 0.25 percentage point rate hike on Wednesday.

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