The number of job openings in the U.S. rose from 7.7 million in July to 8 million in August, the first rise after two consecutive months of decline. However, hiring remained soft, which will likely push the Federal Reserve to cut interest rates again in its next meeting.
The Department of Labor‘s Job Openings and Labor Turnover Survey (JOLTS) revealed that layoffs declined in August to 1.6 million from 1.7 million in July. There were 1.13 job openings for every jobless person in the U.S. in August, up from 1.08 in July.
The data also revealed a decline in the number of individuals quitting their jobs to 3.1 million from 3.2 million in July, signaling a decline in confidence among workers.
Despite the recent recovery, labor market conditions have clearly cooled over the past year. “Workers now view jobs as somewhat less available than they were in 2019,” Fed chair Jerome Powell said in his latest comments.
Sector variations
The number of U.S. job openings increased in construction by 138,000 positions and in state and local government, excluding education by 78,000. Job openings, however, decreased in other services by 93,000.
Meanwhile, layoffs and resignations increased by 149,000 in the business services sector but declined in accommodation and food services and in state and local government, excluding education.
Notably, the labor department revised July’s higher to show 7.711 million job openings instead of the previously reported 7.673 million.
The job openings rate increased to 4.8 percent from 4.6 percent in July. Businesses with 10 to 49 employees reported 203,000 more job openings. Meanwhile, medium-sized and large companies saw a decline in vacancies.
Read | Policy will move over time toward a more neutral stance: Fed’s Powell
Labor market outlook
In its latest meeting, the Federal Reserve cut interest rates by 50 basis points, reflecting the growing confidence in the country’s economy and declining inflation. “Many indicators show the labor market is solid,” noted Powell.
The U.S. unemployment rate is well within the range of estimates of its natural rate and layoffs are low. Real wages are also increasing at a solid pace, broadly in line with gains in productivity. The moderation in job growth and the increase in labor supply have led the unemployment rate to increase to 4.2 percent, still low by historical standards.
For more economy news, click here.
