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  • Writer's pictureNick Andriacchi

October Jobs Report - Trick or Treat?

The October jobs report came in weaker than expected with large downward revisions for August (-62,000) and September (-39,000). So maybe September’s robust employment report was just a blip. APD reported anemic employment growth for the second month in a row.


Unemployment kicked up to 3.9% - but still historically low and there are still plenty of open jobs.


In terms of interest rates, the Fed continued its pause and might be done raising rates. There is plenty of economic data to support the end of rising Fed rates.


As stated earlier, October job growth came in below economists’ expectations (189,000 est. vs 150,000 actual). According to the latest Federal Reserve Beige Book report, the job market generally continues to soften. Generally, over the 12 Fed districts, wage growth is moderating, and employees are quitting less as the labor pool grows. The notable exceptions are in healthcare and skills trades. Those areas remain tight.


I would say October’s report is mostly a TREAT.





· The talent force contracted by 201,000


· Employment in temporary help services was up for just the second time this year trend (6,600)


· Average hourly earnings rose 0.2% for the month, below analysts’ expectations.


· Healthcare (+58,000) and Government (+51,000) were the big winners this month. Manufacturing (35,000) was done mostly due to the auto worker’s strike.


· The JOLTS report estimates that there are 9.6 mm open jobs, about the same as August. Quits held steady as employees have become more reluctant to change jobs. Companies with over 5,000 reported fewer job openings.



· A more encompassing measure of unemployment (U6) that includes discouraged workers and those holding part-time jobs for economic reasons is up .2% to 7.2%.


· Prime age labor force participation rate (ages 25-54) was down .2% to 83.3%.


· The overall labor force participation was down .1% to 62.7%. This is still .5% below the level of February 2020.


· In October, average hourly earnings for all employees on private nonfarm payrolls rose by 7 cents, or 0.2 percent, to $34.00. Over the past 12 months, average hourly earnings have increased by 4.1 percent. In October, average hourly earnings of private-sector production and nonsupervisory employees rose by 10 cents, or 0.3 percent, to $29.19.


· The average workweek for all employees on private nonfarm payrolls edged down by 0.1 hour to 34.3 hours in October. In manufacturing, the average workweek was little changed at 40.0 hours, and overtime edged down by 0.1 hour to 2.9 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls edged down by 0.1 hour to 33.7 hours.


· APD is reported that only 113,000 jobs were added last month.


Source: ADP, BLS, CNBC, Fox News




JOB OPENINGS AND LABOR TURNOVER – September 2023


The number of job openings changed little at 9.6 million on the last business day of September, the U.S. Bureau of Labor Statistics reported today. Over the month, the number of hires and total separations changed little at 5.9 million and 5.5 million, respectively. Within separations, quits (3.7 million) and layoffs and discharges (1.5 million) changed little. This release includes estimates of the number and rate of job openings, hires, and separations for the total nonfarm sector, by industry, and by establishment size class.

Job Openings


On the last business day of September, the number of job openings changed little at 9.6 million, and the rate was unchanged at 5.7 percent. Over the month, job openings increased in accommodation and food services (+141,000) and in arts, entertainment, and recreation (+39,000). Job openings decreased in other services (-124,000), federal government (-43,000), and information (-41,000).


Hires


In September, the number of hires changed little at 5.9 million, and the rate was 3.7 percent for the third month in a row. The number of hires changed little in all industries.


Separations


Total separations include quits, layoffs and discharges, and other separations. Quits are generally voluntary separations initiated by the employee. The quits rate can serve as a measure of workers’ willingness or ability to leave jobs. Layoffs and discharges are involuntary separations initiated by the employer. Other separations include separations due to retirement, death, disability, and transfers to other locations of the same firm.


The number and rate of total separations in September changed little at 5.5 million and 3.5 percent, respectively. Over the month, the number of total separations decreased in state and local government education (-42,000) and in nondurable goods manufacturing (-37,000) but increased in federal government (+8,000).


In September, the number of quits changed little at 3.7 million, and the rate was 2.3 percent for the 3rd consecutive month. The number of quits increased in information (+24,000) but decreased in state and local government, excluding education (-15,000).


In September, the number and rate of layoffs and discharges changed little at 1.5 million and 1.0 percent, respectively. The number of layoffs and discharges decreased in state and local government education (-22,000).


The number of other separations changed little in September at 352,000.


Establishment Size Class


In September, the job openings, hires, and total separations rates changed little for establishments with 1 to 9 employees. The job openings rate decreased for establishments with 5,000 or more employees.

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The Job Openings and Labor Turnover Survey estimates for October 2023 are scheduled to be released on Tuesday, December 5, 2023, at 10:00 a.m. (ET).

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