Hours: Monday - Friday 8:00 am - 5:00 pm

Resources

Job openings rise again in December, adding to pressure on the Fed

REAL ECONOMY BLOG | February 01, 2023

Authored by RSM US LLP


Labor demand surged again in December after two consecutive drops, according to government data released on Wednesday hours ahead of the Federal Reserve’s rate decision.

The number of job vacancies jumped to 11 million in December from 10.4 million, mostly driven by seasonal-related categories like leisure and hospitality, trade and transportation, Bureau of Labor Statistics data show.

Technology job demand showed no surprise, falling by half amid an increasing number of layoffs in recent months.

Job openings

There were 1.9 job openings available per unemployed worker on the month, up from 1.7 in November, the highest since July.

While most market participants have been expecting a labor market slowdown, today’s number on labor demand proves that it might take a while more for the imbalance between labor demand and supply to fade.

The data most likely will not change the Fed’s expected 25 basis-point hike but will certainly make its way into Chairman Jerome Powell’s speech in the afternoon.

The Fed has been clear from the beginning that it is determined to cool the high demand for labor, which puts upward pressure on wages and, in turn, inflation. Wednesday’s job openings data did little to assuage that concern, adding to our case of more rate hikes to come.

Hirings defied widespread announcements of hiring freezes, picking up on the month to 6.2 million from 6 million earlier. Most of the gains came from trade, transportation, education and health services.

The quit rate stayed unchanged at 2.7%, mostly from small companies that have fewer than 50 employees.

Quit rates

Overall, the data suggests that while layoffs and hiring freezes from big firms are making headlines, medium and small -size companies are still struggling with hiring either because of the persistent labor shortages or high turnover rates.

And those struggles are a timely reminder that any speculation of a rate cut based on headlines about layoffs is premature.

Let's Talk!

Call us at (325) 677-6251 or fill out the form below and we'll contact you to discuss your specific situation.

  • Topic Name:
  • Should be Empty:

This article was written by Tuan Nguyen and originally appeared on 2023-02-01.
2022 RSM US LLP. All rights reserved.
https://realeconomy.rsmus.com/job-openings-rise-again-in-december-adding-to-pressure-on-the-fed/

RSM US Alliance provides its members with access to resources of RSM US LLP. RSM US Alliance member firms are separate and independent businesses and legal entities that are responsible for their own acts and omissions, and each is separate and independent from RSM US LLP. RSM US LLP is the U.S. member firm of RSM International, a global network of independent audit, tax, and consulting firms. Members of RSM US Alliance have access to RSM International resources through RSM US LLP but are not member firms of RSM International. Visit rsmus.com/about us for more information regarding RSM US LLP and RSM International. The RSM logo is used under license by RSM US LLP. RSM US Alliance products and services are proprietary to RSM US LLP.

Condley and Company, LLP is a proud member of the RSM US Alliance, a premier affiliation of independent accounting and consulting firms in the United States. RSM US Alliance provides our firm with access to resources of RSM US LLP, the leading provider of audit, tax and consulting services focused on the middle market. RSM US LLP is a licensed CPA firm and the U.S. member of RSM International, a global network of independent audit, tax and consulting firms with more than 43,000 people in over 120 countries.

Our membership in RSM US Alliance has elevated our capabilities in the marketplace, helping to differentiate our firm from the competition while allowing us to maintain our independence and entrepreneurial culture. We have access to a valuable peer network of like-sized firms as well as a broad range of tools, expertise and technical resources.

For more information on how Condley and Company can assist you, please call (325) 677-6251.

Share This