Job openings in the United States of America surged in an unexpected manner in the month of September 2022 showing signs of a severe crisis in the labor markets America. An unexpected increase in job openings is expected to pose a bigger challenge to the Federal Reserve of the United States as the central bank was hoping to cool off the crisis in the labor markets.
According to recent data from the labor department of the Federal Government, employers posted nearly 10.7 million job vacancies in September 2022. In August 2022, the total number of job vacancy postings was 10.2 million.
Economists and market analysts were expecting total job openings to go below 10 million in September.
Employers around the country are now complaining they are not able to get workers for various openings in their establishments as employees are now having multiple choices for a job. Workers are choosing jobs that give higher salary and has flexibility in working conditions.
The covid-19 pandemic and resultant lockdown had impacted the economy of the United States of America in a severe manner. As the lockdown was released and businesses started reopening, there were many jobs available in the labor market and employees always chose jobs that give higher salaries or perks. Workers now had various options to choose from for a job. This forced employers to increase the salary and perks for each job opening.
Increased wages are one of the major factors for high inflation in the economy of the United States which at one point touched a 40-year high rate. As wages increase for each job, more and more money will be injected into the economy which in turn will increase demand and prices for essential commodities. This causes inflation.
In order to control high inflation in the economy, Federal Reserve has been increasing benchmark interest rates. Fed is expected to announce another interest rate hike in a meeting on Wednesday.
Chairman of the Federal Reserve, Jerome Powell had earlier said that employers should cut job openings and not jobs, in order to reduce inflationary pressure in the domestic economy.