The Federal Reserve's monetary tightening is starting to have an effect on the job market, as job openings dropped to 10.1 million in August, Labor Department data showed today. That's a steep decline from July's numbers, when the number of available jobs stood at 11.2 million.
A slowing job market is expected as the Fed continues to hike interest rates. And, Fed Chair Jerome Powell has said that the labor market would "soften," which could bring some "pain." But that's exactly what the Fed wants. With inflation continuing to run hot, making it harder and more expensive for all of us to buy groceries, clothes, and other items, the Fed needs to slam the brakes on the economy.
And what does a slowing economy bring? Fewer jobs. But it could also bring a recession.
The more that the economy slows, the greater the risk of recession, and the less likely it is that the Fed will do aggressive interest rates hikes. And that's what investors are hoping for. Today, markets are rallying, boosted by the news of declining job openings giving way to optimism the Fed might ease up in its inflation fight.
Even with declining employment opportunities, there are still plenty of jobs for people who want them. But that door is narrowing (and quickly, it seems). So if you're currently seeking a job or just thinking about it, you might want to try to secure one now before a potential recession hits, which would make job hunting much more difficult.
- Kristin
0 comments:
Post a Comment