Job openings fell more than expected to the lowest level since January 2021

Number of job openings in the US unexpectedly fell in September to the lowest level since January 2021, suggesting that the labor market continues to soften.

Job openings fell by 418,000 to 7.443 million on the last day of September, the lowest level in three and a half years, the Labor Department’s Bureau of Labor Statistics said Tuesday in its Job Openings and Labor Turnover Survey, known as JOLTS report.

Economists polled by Reuters had predicted 8 million job openings. Employment increased by 123,000 to 5.558 million, while layoffs increased by 165,000 to 1.833 million.

“The September JOLTS report points to continued cooling in the labor market, with significant declines in job openings and layoffs, and a sharp increase in layoffs,” Julia Pollak, chief economist at ZipRecruiter, told FOX Business.

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“The rate of labor in the labor market has fallen significantly, as the labor rate (attrition and layoff rate) has fallen below pre-Covid levels for the first time since the recession, down nearly 50 percent since inflation began. A big resignation,” he added.

August data was also revised down to show 7.861 million unfilled positions instead of the previously reported 8.04 million job vacancies.

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The JOLTS report showed a weak trend in job seekers. (Angus Mordant/Bloomberg via/Getty Images)

The JOLTS report leads a list of several notable labor market reports to be released this week, with the ADP private sector payrolls report scheduled for release on Wednesday and Department of Labor’s September jobs report on Friday.

A Reuters poll of economists predicted Friday’s jobs report was likely to come in at 115,000 in October after a surprisingly strong 254,000 jobs in September.

That would leave the October jobs report as the smallest in six months, adding to the case The Federal Reserve continuing to lower interest rates.

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The Fed’s policy-making arm, the Federal Open Market Committee, meets next week and is expected to issue its next decision on interest rate cuts on Thursday. (Roberto Schmidt/AFP via/Getty Images)

The Fed’s policy-making arm, the Federal Open Market Committee, meets next week and is expected to issue its next decision on the Thursday after that. lower the interest rate in September for the first time in four years. Markets currently expect the Fed to cut rates by 25 basis points after a larger-than-usual 50 basis point cut in September.

“The JOLTS report suggests that the Fed should not be deterred from continuing rate cuts on the basis of a stronger-than-expected jobs report. It should remain focused on labor market risks, and exercise caution in the face of relatively weak JOLTS data,” Pollak said.

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“The decline in layoffs is accompanied by downward pressure on wage growth and continued inflation – a fact that Fed governors will no doubt be mindful of when they meet next week,” he added.

Reuters contributed to this report.