Source: Economics Group of Wells Fargo Bank, N.A.
Summary
Despite the impressive headline numbers from the January Employment Situation, the first Job Opening and Labor Turnover Survey for 2024 showed that labor market conditions continue to gradually cool. Job openings fell slightly in January to 8.86 million, 16% below their year-ago levels. The number of job openings per unemployed worker, a frequently cited metric by Fed officials, was little changed in January at 1.45, down from 1.82 a year ago. Turnover also continues to decline on trend as demand for additional workers has eased and more workers are staying put in their current role. The share of workers quitting their job fell to 2.1% in January, which marked the lowest rate in six years, excluding the spring of 2020.
For now, the JOLTS data signal that the jobs market is slowly settling down, consistent with wage, and thus inflation, pressures cooling without a worrisome slowdown in net job creation and overall economic activity. The gradual, rather than marked, softening in the labor market will likely keep the FOMC comfortable in waiting a little while longer before beginning to cut rates.