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Stocks Soar, Dollar Weakens as U.S. Job Vacancies Plummet in August

Economic Indicators Oct 04, 2022 10:18AM ET
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By Geoffrey Smith 

Investing.com -- The U.S. labor market finally stopped defying gravity in August, the number of vacancies dropping sharply as the surge in inflation overshadowed the outlook for the economy, prompting employers to scale back their hiring plans. 

The Labor Department said total vacancies fell by over 1 million in August to 10.053 million, from a July number that was also revised down by nearly 70,000 to 11.170 million. The number, which was well below analysts' expectations for a total of around 10.775 million, was the lowest in over a year, and represented the biggest monthly decline since the early stages of the pandemic in April 2020.

"This is the first official indicator to point unambiguously, if not necessarily reliably, to a clear slowing in labor demand," said Ian Shepherdson, chief economist with Pantheon Macroeconomics, in a note to clients.

Financial markets took the news as an argument for the Federal Reserve to stop raising interest rates aggressively, inasmuch as it corroborates other evidence of an increasingly broad and clear slowdown in the U.S. economy. 

The yield on the benchmark 10-Year U.S. Treasury note fell 9 basis points to 3.66%, a two-week low, while the dollar index, which tracks the greenback against a basket of six developed economy currencies, fell around a quarter point to 110.65. The S&P 500 meanwhile, rose 2.8%, while the Dow Jones Industrial Average and Nasdaq Composite rose 2.5% and 3.3% respectively.

Daniel Zhao, chief economist with Glassdoor, tweeted that the decline in job openings "was across the board, hitting most industries," although other items of the report, such as the so-called 'quit rate' and other separations, were largely unchanged. While they ticked up a little, Zhao said separations were still "well below pre-pandemic levels" and "not a red flag yet."

The numbers translated into an abrupt drop in the ratio of vacancies to job-seekers, a measure of labor market tightness that Federal Reserve officials have frequently referred to this year as they have warned of it overheating. There are now 1.61 jobs available for every registered unemployed person, down from 1.97 in July. 

There are now 1.61 jobs available for every registered unemployed person, down from 1.97 in July. But while that is still a clear drop, it's still well above what was normal before the pandemic, according to Harvard professor and Peterson Institute senior fellow Jason Furman. 

"The labor market went from very, very tight to very tight," Furman tweeted. 

The numbers are the first of a series of sensitive data this week from a labor market whose strength this year has been one of the cardinal factors driving interest rates higher. They'll be followed on Wednesday by ADP's report on private-sector hiring in September, which will in turn be followed by the government's labor market report on Friday. Analysts expect the pace of hiring to have moderated further last month, but the 250,000 consensus for nonfarm payroll growth is still well above what was normal before the pandemic.

Stocks Soar, Dollar Weakens as U.S. Job Vacancies Plummet in August
 

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Comments (14)
Eric Moon
Eric Moon Oct 04, 2022 11:54PM ET
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blah blah blah blah blah..market is going to crash to historic low
Sean Brennan
Sean Brennan Oct 04, 2022 11:48AM ET
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SnP will test 350 by Nov 5th, Jolt report gives every reason for another 75 point hike.
pablo escobar
pablo escobar Oct 04, 2022 11:45AM ET
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USD is a toilet paper
First Last
First Last Oct 04, 2022 11:45AM ET
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I'll trade you 2 kg of toilet paper for 1 kg of USD
Kamlesh Morjaria
Kamlesh Morjaria Oct 04, 2022 11:45AM ET
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Totally agree💩💩💩
Gamer Turtle
GamerTurtle Oct 04, 2022 11:40AM ET
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stock started its pump over the weekend, there is no correlation between what's today and the JOLT. in fact JOLT has never been that important in the past. Economic slowdown and inflation aren't that tied, otherwise inflation wouldn't be where it is today given 2 negative gdp. the real reason behind this movement is what was said between the banks, funds, and other whales on the weekend that they're all playing on the same side, clearly there is no opposition in the movement.
Baer Markit
Baer Markit Oct 04, 2022 11:17AM ET
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All I can says is thank God Biden is our president and not the other guy.
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John Hill
John Hill Oct 04, 2022 11:17AM ET
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ignorance is bliss. you are the evidence.
Mike Wellons
Mike Wellons Oct 04, 2022 11:17AM ET
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Somehow you forget that the Taliban increased their power during Trumps 4 years in office. Why didn't he defeat the Taliban instead of allowing them to get stronger? And it was Trump that signed the surrender to the Taliban, not Biden. Why didn't Trump put in place a withdrawal plan, instead of having no plan whatsoever to get SIVs out? Then, he allows Iran to develop nuclear weapons, merely because Obama stopped Iran's nuclear development, he had to reverse this. ugh, good ridence
John Hill
John Hill Oct 04, 2022 11:17AM ET
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tell me, how many terrorist attacks did we have under Trump? here or abroad? how many under Obama? How is the crime rates today under Biden compared to Trump? Human trafficking and fentanyl deaths are nearly doubled today. Drug use considerably higher. Both Russia and China and the Taliban were kept on a leash under Trump. Russia invades Ukraine under Biden and China claiming Taiwan vehemently. Not under Trump. Trump kept Al Queda on a leash also. Liberals want to sidetrack the bigger picture at the expense of the entire country while making excuses for a man that can barely tie his own shoes. Only TWENTY NINE PERCENT of Americans think the country is going in the right direction. You are apparently in that very small minority. learn to use Google and seek truth and stop playing politics with the future of my children.
John Hill
John Hill Oct 04, 2022 11:17AM ET
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supply was destroyed by that communist doctor fauci and his bogus claims about coronavirus. liberals persistence that the entire country close down is what caused the supply shortage and the destruction of our food supply. you need to get real and stop playing politics with the future of this country unless it is your intent to destroy her. that would not surprise me a bit.
First Last
First Last Oct 04, 2022 11:17AM ET
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John Hill  The CCP was "claiming Taiwan vehemently" (& militarizing islands) under Trump.  On 31 Oct 2017, Sayfullo Saipov drove a truck into people on the NYC Hudson River Park's bike path alongside West St.  On 8 Jan 2020, Iran launched over 12 ballistic missiles at US airbases in Iraq.
marcus daily
marcus daily Oct 04, 2022 10:59AM ET
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cant really say jolt numbers plummeted.  yes they are down, but for years, average jolt numbers were running 6 million.  covid/democrats in control and things go haywire.   economic numbers are still a bit weak.   we have elections, stock market will be skewed from the hype in one direction or another.  this new quarterly earnings reports will be the key.
First Last
First Last Oct 04, 2022 10:59AM ET
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The max under Trump was 7.6 million
perplexed76 .
perplexed76 . Oct 04, 2022 10:55AM ET
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keep raising, markets' gamblers will merely make everything more expensive and inflation wiil soar.
First Last
First Last Oct 04, 2022 10:55AM ET
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You overestimate "markets' gamblers"
RF RF
RF RF Oct 04, 2022 10:51AM ET
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The gap between job openings and hires is unusually large. This indicates that openings are not closed yet. Expect another sharp drop for September of at least this size.
Chad Richer Than You
Chad Richer Than You Oct 04, 2022 10:49AM ET
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Fight the feds
znao sam
znao sam Oct 04, 2022 10:42AM ET
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dems are doomed, thanks God
toni alfaro
toni alfaro Oct 04, 2022 10:42AM ET
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who do you think is creating jobs sucka
lakes Tenn
lakes Tenn Oct 04, 2022 10:42AM ET
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companies. the Democrats are creating inflation, global hostility and the slowing economy
First Last
First Last Oct 04, 2022 10:42AM ET
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Market is up and job opening is positive.  Fake doom.
 
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