U.S. Job openings slipped in May but remained at levels high enough to illustrate that the American labor market remains resilient in the face of sharply higher interest rates.
Employers posted 9.8 million job vacancies, down from 10.3 million in April, the Labor Department said Thursday. But layoffs fell slightly, and more Americans quit their jobs — a sign they were confident they could find better pay or working conditions elsewhere.
Job openings fell in healthcare, insurance and finance. But there were more jobs available in education and government.
The Labor Department’s Job Openings and Labor Turnover Survey (JOLTS), “continues to reflect a gradually slowing yet still-robust labor market, one that is cooler than a year ago but still hot,” said Nick Bunker, research director at the Indeed Hiring Lab. He added that “demand for new hires remains elevated and employers are still holding onto the workers they have.”
Monthly job openings remain high by historic standards — they had never hit 8 million before 2021 — despite the Federal Reserve’s aggressive campaign since to cool the American labor market and combat inflation that last year hit four-decade highs. The Fed has hiked its benchmark short-term interest rate 10 times since March 2022.
The higher borrowing costs have had an impact: Economic growth has slowed, and monthly job openings are down from their March 2022 peak of 12 million, highest on record. Inflation is down, too: Consumer prices were up 4% in May from a year earlier, down from a year-over-year peak of 9.1% in June 2022 but still double the Fed’s 2% target.
Economists have long predicted the United States would tumble into recession this year. But the job market’s persistent sturdiness has raised doubts about whether a downturn is inevitable after all.
Employers have added a strong 314,000 jobs a month this year, and at 3.7% in May, the unemployment rate is not far off a half-century low.
The Labor Department on Friday releases its employment report for June. Forecasters surveyed by the data firm FactSet expect that payrolls rose by another 205,000 last month and that unemployment dipped to 3.6%.