Federal data showed fewer available positions in June while hiring and layoffs remained largely unchanged and voluntary departures rose to their highest level since December.
By yourNEWS Media Newsroom
U.S. employers reported 7.36 million job openings in June, the lowest level since March, as labor demand weakened ahead of the summer while hiring and layoffs showed little movement.
The number of available positions declined by 178,000 from a downwardly revised 7.54 million in May, according to Bureau of Labor Statistics data released Aug. 4. Economists had expected approximately 7.4 million openings.
The report added to evidence of a labor market characterized by limited hiring and relatively few dismissals. Employers hired 5.3 million workers during the month, unchanged from May, while layoffs and discharges remained at 1.8 million.
Bruce Fallick, senior vice president at the Cleveland Federal Reserve, described the combination as historically unusual but potentially rooted in longer-term changes rather than current economic conditions alone.
“Hires and quits have been low during the strong labor market over the past year or so, when layoffs have also been low,” Fallick wrote in an Aug. 4 paper.
“This combination is historically unusual. However, it is likely a continuation of long-term trends rather than something unique to the current period.”
Job growth was uneven across industries. Transportation, warehousing and utilities added 97,000 openings, while the federal government recorded an increase of 39,000.
Wholesale trade vacancies fell by 74,000. Nondurable goods manufacturing declined by 55,000, and mining and logging openings dropped by 9,000.
The decline in vacancies arrived before the release of the July nonfarm payrolls report, with other labor indicators suggesting that employment conditions remained generally stable despite slower hiring.
Private-sector employers added an average of 15,000 workers per week during the four weeks ending July 11, according to payroll processor ADP.
The economy created 57,000 jobs last month, below expectations and substantially lower than the three-month average of 164,000. Economists expect the July report to show a gain of approximately 80,000 jobs.
Businesses have reduced the pace of hiring while navigating persistent inflation and elevated borrowing costs.
Unemployment claims have also remained low. Initial claims were near their lowest levels since 1969 last week, which could indicate that displaced workers are finding jobs more quickly or that some recipients have exhausted their benefits.
June also brought an increase in workers voluntarily leaving their jobs.
Quits rose by 79,000 to 3.23 million from an upwardly revised 3.153 million in May, reaching their highest total since December. The quits rate, which measures voluntary departures as a percentage of total employment, remained unchanged at 2%, its lowest level in six years.
A rise in voluntary departures can signal greater confidence among workers that they can find another position, although the historically low quits rate suggests that broader mobility remains subdued.
Consumer surveys showed a more cautious assessment of the labor market.
The Conference Board’s July consumer confidence survey found fewer respondents saying jobs were “plentiful.” The share reporting that jobs were “hard to get” also declined during the month.
“Looking ahead, consumers anticipate little improvement in business conditions over the next six months, but expectations for the labor market were slightly less negative. Expectations for household incomes moderated but remained optimistic overall,” Dana Peterson, the Conference Board’s chief economist, said in a statement.
The mixed employment picture is unlikely by itself to determine the Federal Reserve’s next policy move.
The central bank is responsible for both maximum employment and price stability, but officials have placed greater emphasis on inflation after it remained above the Fed’s 2% target for 64 consecutive months.
Although policymakers have acknowledged risks of further labor-market deterioration, traders widely expect the central bank to raise interest rates at its next meeting for the first time since July 2023.
Thomas Browne, a portfolio manager at Keeley Gabelli, said uncertainty surrounding the Fed’s leadership makes the outcome difficult to predict.
“We’ve got a brand-new chairman who doesn’t want to signal his intentions. You can say, ‘Yes, he will,’ or ‘No, he won’t,’ but there’s really no track record to go on, and he’s made it pretty clear that he doesn’t want to tell the market what he’s going to do,” Browne said in an emailed note to The Epoch Times.
“I don’t think he raises rates, but my level of confidence in that conclusion isn’t all that high.”
Federal Reserve Chairman Kevin Warsh is scheduled to preside over the next two-day Federal Open Market Committee meeting on Sept. 15 and 16.
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