Increased job opportunities have continued to put pressure on the Federal Reserve. Another indicator that the economy hasn’t cooled enough to prevent more interest rate hikes by the Federal Reserve is the increase in the number of job postings in the United States in April to a three-month high of 10.1 million.
The number of job postings increased from March’s revised 9.7 million, the Labor Department reported Wednesday.
The Wall Street Journal surveyed economists, and they anticipated a total of 9.5 million job openings.
Job vacancies are a leading indicator of the United States’ labor market and economic growth. Although the number of job listings has decreased since the spring of last year, it is still significantly more significant than the Federal Reserve would prefer.
The Federal Reserve would want to see a further slowing of job opportunities and hiring to reduce inflationary pressure.
Meanwhile, the number of persons leaving their positions decreased to 3.79 million. For the first time since the middle of 2021, resignations fell below 4 million in January. Since then, however, they have remained relatively stable.
The job market remains historically good by practically every metric.
The retail sector, the healthcare industry, transportation, and storage have seen the most significant increases in job vacancies.
The numbers of listings in the manufacturing, government, and hospitality sectors all decreased.
Economists use the growth rate of job opportunities as a proxy for the labor market’s health, even if many positions remain unfilled.
In April, there were 1.8 job vacancies for every unemployed person, substantially above pre-epidemic norms of 1.2.
The Fed closely monitors the ratio, hoping it will return to pre-pandemic levels.
The so-called quits rate for the private sector remained steady at 2.7% recently. A year ago, it reached a high of 3.3%.
When the job market appears competitive, employees are more likely to leave their positions for higher pay and benefits.
The United States economy is expected to grow by 188,000 jobs in May. On Friday, May’s employment data will be released.
The Federal Reserve is concerned that inflation will be more difficult to contain if there are too many available jobs and insufficient people to fill them.
The rising expense of attracting and retaining top people is reflected in higher consumer prices. Most companies’ primary cost center is labor.
Both inflation data and consumer expenditure figures released recently in the United States have been higher than predicted.
As a result, the Federal Reserve may have to reconsider whether to hold off on its 11th consecutive rate hike when it meets on June 13-14. Top bank officials wanted to wait and see how their rate hikes affected the economy before making more adjustments.
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Wednesday’s trade saw a continuation of losses for the Dow Jones Industrial Average DJIA, -0.58%, and the S&P 500 SPX, -0.69%, in response to the job-openings news. Bond yields (measured in TMUBMUSD10Y, 3.660%) have fallen to 3.67%.