Why it matters: The last major data release before the Federal Reserve interest rate decision.
The report, called the Job Openings and Labor Turnover Survey (JOLTS), released Tuesday is one of many reports the Federal Reserve (Fed) closely monitors each month, spurring widespread layoffs. Efforts to slow the economy and moderate inflation without
The Federal Reserve has been raising interest rates for more than a year in an attempt to bring rapid inflation down to its 2% target. We will announce our next decision on Wednesday. Officials are widely expected to raise interest rates by a quarter of a percentage point to give him just over 5%. The JOLTS report is the last major piece of data that Fed policymakers will see before making a decision.
In particular, they are interested in the number of job openings per available unemployed person. This mismatch leads to higher wages and contributes to inflation. More recently, however, the ratio has fallen, a welcome sign for the Fed and highlighting a modest slowdown in the labor market.
Officials are also tracking other details in the report, such as the number of layoffs and workers who quit their jobs.
Background: Labor market resilience complicates the Fed’s plans.
Month after month, the labor market remains strong, defying expectations and complicating the Fed’s efforts to cool the economy. Wages and salaries of private sector workers rose 5.1% in March from a year earlier, the same growth rate as in December, according to the latest evidence released on Friday, according to government data.
Still, rising interest rates are hurting the job market, albeit slowly. Employers said he added 236,000 jobs in March. That’s a healthy number, but down from his average of 334,000 jobs added over the past six months. Year-over-year growth in average hourly wages also fell to its slowest pace since July 2021.
Up next: A big week of economic news.
Tuesday’s report kicked off a big few days of economic news.
In addition to Wednesday’s Fed decision, there will be a monthly snapshot of the Labor Department’s employment situation on Friday. Based on April data, the report provides a clearer and more up-to-date picture of the labor market, including changes in employment numbers (27 consecutive months of positive figures) and the unemployment rate.
