1. In July, the number of job vacancies in the usa was revised down from 7.91 million to 7.67 million, marking the second consecutive month of decline. 2. Federal Reserve officials have clearly stated that they do not want to see further cooling of the labor market, and the market generally expects them to begin reducing interest rates at the next meeting.
USA job vacancy data for July fell to the lowest level since early 2021, while layoffs increased, consistent with other signs of slowing labor demand.
The Job Openings and Labor Turnover Survey data released by the U.S. Bureau of Labor Statistics on Wednesday showed that the number of job vacancies in the usa decreased from the revised 7.91 million last month to 7.67 million, marking the second consecutive month of decline and lower than the market's expectation of 8.1 million.
Meanwhile, a series of recent data shows that the job market is softening, causing concern among Federal Reserve officials. Employment growth has been slowing, unemployment rates are rising, and job seekers are finding it harder to secure employment, intensifying concerns about a potential economic downturn.
While slowing employment growth was expected, there is now concern that the labor market is not just temporarily adjusting under the Fed's pressure to raise rates to curb inflation, but is actually heading towards collapse.
Federal Reserve officials have made it clear that they do not want to see further cooling of the labor market, and the market generally expects them to begin reducing interest rates at the next meeting in two weeks.
Following the disappointing job vacancy data in July and the significant downward revision of non-farm payroll data, Federal Reserve officials and market participants are closely watching the employment data scheduled to be released this Friday in August. If the data falls short of expectations again, it could prompt a significant interest rate cut by the Federal Reserve.
The Bureau of Labor Statistics pointed out that the number of job vacancies has decreased significantly, while the number of layoffs in July increased to 1.76 million, the highest level since March 2023, mainly in the leisure and hotel industries.
In addition, the ratio of job vacancies to available workers, which the Federal Reserve closely monitors, remains at a ratio of 1.1:1, the lowest level in three years. When it reached its peak in 2022, this ratio was 2:1.
The so-called quit rate has slightly increased to 2.1%, still close to the lowest level since 2020. This suggests that compared to a few years ago, people are less confident in their ability to find new jobs.
After the data was released, interest rate swaps show that the Federal Reserve will further ease monetary policy in 2024. Chris Larkin, of Morgan Stanley E*Trade, stated, "The market may not be as nervous as it was a month ago, but they are still looking for evidence that the economy is not cooling too much. So far this week, they haven't received confirmation."
Nick Bunker, the Director of Economic Research at Indeed Hiring Lab, commented that the labor market is no longer just cooling to pre-pandemic levels, but has cooled to even lower levels than before the pandemic. He emphasized that no one, especially the decision-makers at the Federal Reserve, should hope for further cooling of the labor market.
Editor/ping