Notably, the largest job increases were observed in the government sector, with 52,000 jobs added, while healthcare followed closely with 38,000 new positions. These gains helped offset notable losses in transportation and warehousing, shedding 23,000 jobs and in social assistance, which saw a decrease of 21,000 positions.
Mike Fratantoni, chief economist of the Mortgage Bankers Association, pointed out that businesses are hiring fewer temp workers, down 33,000 for the month and 346,000 from its peak – a sign that businesses are adapting to the current market. The labor force participation rate also slightly decreased to 62.5% from 62.8% the previous month.
“Job openings, the pace of hiring, and the quits rate are all trending down, but layoffs and initial claims for unemployment insurance are not moving higher. Together, these data indicate a market where employers are slower to take on new employees but are not seeing enough weakness to dramatically cut payrolls,” Fratantoni explained, projecting a potential increase in unemployment as the economy slows in 2024.
Fratantoni and other economists are cautiously optimistic, predicting that the loosening of the labor market and a decline in broader inflation could prompt the Federal Reserve to begin reducing rates in the coming year, with some expected cuts as early as May.
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Source: mpamag.com