Tuesday, December 06, 2022

Vacancies available in the US increase unexpectedly

Vacancies available in the US increase unexpectedly

The number of available vacancies in the United States unexpectedly increased in September, indicating that the labor market is not cooling down as the Federal Reserve hoped in its fight against inflation.

The Labor Department reported Tuesday that employers posted 10.7 million job openings in September, compared to 10.2 million in August. Economists had predicted that available space would fall below 10 million for the first time since June 2021.

Over the past two years, as the economy has recovered from the slowdown of the pandemic, employers have complained that they are not getting enough workers. With so many jobs available, workers have the comfort of leaving and looking elsewhere with better pay or conditions, so companies have been forced to raise wages to attract and retain employees, but higher wages. This contributes to the high rate of wage inflation which reached its highest level in 40 years in 2022.

In another sign of labor market strength, layoffs fell to 1.3 million in September, their lowest level since April, but job layoffs fell to less than 4.1 million, a historically high happened.

In its fight against inflation, the Federal Reserve has raised interest rates five times so far this year and the US central bank is likely to do so again this Wednesday and again in December. The Fed is trying to achieve what is called a “soft landing”, that is, raising interest rates enough to bring down inflation, but not enough to cause a recession.

Fed Chairman Jerome Powell has expressed hope that employers can ease inflationary pressures by cutting vacancies, not jobs.

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