The number of positions in the U.S. waiting to be filled dropped in October, indicating a sustained surge in the labor market may take time to develop, a government report showed.
Payrolls climbed by 120,000 workers in November after a 100,000 gain in October, and the unemployment rate fell to 8.6 percent, Labor Department figures showed on Dec. 2. Companies may remain reluctant to expand their workforce as the threat from Europe’s debt crisis and political gridlock in the U.S. weighs on the outlook for the world’s largest economy.
“Businesses are not ready to take on a lot of workers as demand is lackluster,” Tom Porcelli, chief U.S. economist at RBC Capital Markets Corp. in New York, said before the report. “Growth just isn’t strong enough.”
Other reports today showed retail sales climbed in November at the slowest pace in five months and companies boosted inventories in October.
Purchases increased 0.2 percent after a 0.6 percent advance in October that was more than initially reported, Commerce Department figures showed. Economists projected a 0.6 percent November increase, according to the median forecast in a Bloomberg News survey.
Stockpiles increased 0.8 percent, the most in five months, other data from the agency showed.
Job openings dropped 3.3 percent in October from a revised 3.38 million in the prior month that was more than previously estimated, the report from the Labor Department showed.
The rate of job openings decreased to 2.4 percent from 2.5 percent in September. Professional and business services, which include accountants and temporary-help agencies, showed the biggest decrease in available employment.
The report helps shed light on the dynamics behind the monthly employment figures. Payrolls advanced in November, following revisions that added a total of 72,000 jobs to payrolls in September and October, the Labor Department reported earlier this month. Private employment rose by 140,000, it said.
Among companies expanding payrolls is Boeing Co. (BA), the largest U.S. aircraft maker. The Chicago-based company is hiring about 100 machinists a week as it boosts production by about 60 percent over three years to whittle down a backlog that now stretches to nearly 4,000 aircraft.
Vying for Jobs
Compared with the 13.9 million Americans who were unemployed in October, today’s figures indicate there were about 4 people vying for every opening, up from about 1.8 when the recession began in December 2007.
Employers took on 4.04 million workers in October, down from 4.15 million the previous month, today’s report showed.
Total firings, which exclude retirements and those who left their job voluntarily, decreased to 1.6 million from 1.72 million a month before.
In the 12 months ended in October, the economy created a net 1.3 million jobs, representing 48.1 million hires and about 46.8 million separations, today’s report showed.
American businesses are concerned the euro region may slide into recession as European leaders struggle to solve the sovereign debt crisis, causing a global slowdown that would also limit U.S. growth.
In the U.S., politicians are clashing over proposals on a payroll tax break set to end on Dec. 31. If Congress doesn’t act, the two-percentage-point reduction in the payroll tax for employees will expire at the end of this year, and workers will pay 6.2 percent of their first $110,100, up from 4.2 percent.
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