U.S. labor market weakens – Why this October could be different for Bitcoin

The U.S. labor market is showing signs of weakness.

The Labor Department’s JOLTS report, released on the 29th of September, shows that U.S. job openings decreased to 7.079 million in August from a revised 7.335 million in July. The job-openings rate also slipped to 4.3% from 4.4%, while hiring increased slightly to 5.192 million. Quits were largely unchanged at 3.066 million, while layoffs and discharges decreased to 1.641 million. 

In short, the labor market is cooling, with weaker demand for workers pointing to a gradual slowdown in employment conditions. As expected, this raises a key question for Bitcoin [BTC] and risk assets heading into Q4: Could a cooling labor market actually become a bullish liquidity catalyst?

From a sentiment standpoint, the setup is becoming more notable. As the chart above shows, the Conference Board’s Consumer Confidence Index fell to 81.9 in September, the lowest level since early 2014. To put that in perspective, confidence was 85.7 in April 2020 and 81.7 in April 2014, showing just how cautious consumers have become.

The drop comes as Americans deal with rising fuel prices, soaring borrowing costs, and weak labor market conditions. More importantly, consumers are now expecting business conditions and the labor market to deteriorate over the next six months. Bloomberg’s latest note provides another bullish angle for Bitcoin, arguing that long-term unemployment in the U.S. is rising at a pace “unprecedented outside recessions,” with the average job search now taking more than six months.