MNI: Fed's Jefferson: Labor Market Softening Across Indicators

A variety of indicators point to a softening in the U.S. labor market that rebalances the risks to the Fed's outlook, Federal Reserve Governor Philip Jefferson said Friday after the official jobs report for September was delayed due to a federal government shutdown. 

"Trends across several data series indicate that the labor market is softening, which suggests that, left unsupported, it could experience stress," he said in a speech for Drexel University in Philadelphia. His monetary policy comments were little changed from earlier in the week when he pledged to "continue to evaluate the appropriate stance of monetary policy based on the incoming data, the evolving outlook, and the balance of risks." 

"The available data from both government and private-sector sources point out that labor supply and demand are slowing together, as reflected in the ratio of job openings to unemployed Americans seeking work" moving back into balance over the past year, he noted. 

"Similarly, last week the Labor Department reported that initial jobless claims continue to mostly trend sideways. Net immigration into the U.S., an important contributor to workforce growth, has dropped sharply, and that is a factor restraining a more significant increase in unemployment." 

Alternate data from public and private sources showed little change in unemployment last month, Chicago Fed President Austan Goolsbee said Friday. (See: MNI INTERVIEW: Fed Right To Remain Cautious On Rate Cuts-Kohn)