Job market still hot, December openings rise to 11 million
Jan 31, 2023, 5:06 PM | Updated: Feb 1, 2023, 8:37 am
A hiring sign is displayed outside of a restaurant in Arlington Heights, Ill., Monday, Jan. 30, 2023. On Wednesday, the Labor Department reports on job openings and labor turnover for December. (AP Photo/Nam Y. Huh)
(AP Photo/Nam Y. Huh)
WASHINGTON (AP) — U.S. job openings rose to 11 million in December, delivering a setback to the Federal Reserve’s effort to cool a hot job market.
Openings were up from 10.44 million in November and were the highest since July, according to data released Wednesday by the Labor Department. Economists had expected job openings to drop slightly in December.
For 18 straight months, employers have posted at least 10 million openings — a level never reached before 2021 in Labor Department data going back to 2000. The number of openings in December meant that there were about two vacancies for every unemployed American.
Employers hired 6.17 million workers in December, up from 6.03 million in November.
Still, layoffs and discharges blipped up to 1.47 million in December from 1.42 million in November. And the number of Americans quitting their jobs — a sign they have confidence they can find a better opportunities elsewhere — fell slightly in December.
Hotels, restaurants and bars accounted for more than 70% of the December increase in job openings.
The American job market has been surprisingly resilient throughout this period of economic uncertainty.
Employers created 375,000 jobs a month in 2022 — second most in Labor Department records dating back to 1940 — and likely added another 185,000 last month, according to a survey of forecasters by the data firm FactSet. January’s hiring numbers come out Friday.
Hiring has remained strong even in the face of rising interest rates, which can increase costs for businesses. Combating inflation that last year hit a four-decade high, the Federal Reserve has hiked its benchmark rate seven times since March and is expected to announce another rate hike later Wednesday.
Fed policymakers are aiming for a soft landing — slowing the economy enough to contain inflation without causing much economic pain. One hope was that that employers would cut job openings — and ease upward pressure on wages that can feed inflation — and without actually cutting many jobs.
“With Fed officials hoping for signs of slowing hiring to support wage growth deceleration, every data point matters,” said Matthew Martin, U.S. economist at Oxford Economics. “The December report unfortunately offered the opposite … showcasing the stubborn resiliency of the labor market.”
Many economists believe the Fed rate hikes will slow the economy enough to cause a recession later this year.
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