Expect A Blah October Jobs Report Tomorrow

Retirement

I expect tomorrow’s October jobs report will be so so. Why? Tuesday’s Labor Department’s monthly Job Opening and Labor Turnover Survey (JOLTS) indicated stagnating labor demand and so do business indicators. The National Association of Business Economists mid-October reported falling sales and fewer incidences of rising sales since July.

Also, JOLTS reported hires were blah. The number of job openings changed little at 9.6 million on the last business day of September. And compared to last month, the number of hires and total separations changed little at 5.9 million and 5.5 million, respectively which means things are about even.

True, the GDP unexpected 4.9 percent growth rate for the third quarter shocked economists. But that growth rate may not signal great expectations for super-sized holiday consumer demand. The strong report may partly reflect an oversupply of inventories, which added almost a quarter of the rise.

Take a look at the “job leavers” share of total unemployed, which complements the quits rate and indicates worker confidence. The job leaver rate in June 2023 was very high at 15.8%. In September 2022, one year later a smaller share of the unemployed were job walk-awayers, just 12.5%. I expect the rate to be about the same tomorrow.

Why does the job leaver share and quits matter? Quits rates (and job leaver share) peak right before a recession. (But note Biden and the Fed avoided a recession in 2020.) When the economy starts to wane workers get worried and hang on to their jobs and they certainly don’t get raises.

I am watching out for the job leavers share of the unemployed, the direction of weekly wages increases, and anything else that might attract attention. I don’t think the headline unemployment rates will change much. It might be a dull report.

Articles You May Like

New York Fed’s Williams says yield surge due to strong economic prospects
Top Wall Street analysts suggest these 3 dividend stocks for consistent income
Does Medicare pay for long-term care? Many people get it wrong — and it may cost them later
Average 401(k), IRA balances hit record highs — but more workers are raiding their accounts, Fidelity says
The big lesson from this week’s earnings: The AI buildout is not a zero-sum game

Leave a Reply

Your email address will not be published. Required fields are marked *