In May, U.S. job openings increased by 221,000 to 8.140 million, indicating a modest rebound following significant declines in the previous two months.
This rise, reported by the Labor Department’s JOLTS survey, maintains the vacancy-to-unemployment ratio at 1.22, its lowest since 2021 and close to the 2019 average of 1.19.
Despite the increase, the labor market trend continues to normalize, potentially allowing the Federal Reserve to consider interest rate cuts later this year.
Job openings saw notable increases in state and local government (excluding education), durable goods manufacturing, and the federal government. However, there were significant decreases in the accommodation and food services sectors and private educational services.
This shift suggests a rebalancing in the labor market, aligning labor supply and demand more closely.
The labor market’s easing and subsiding inflation could prompt the Fed to initiate its easing cycle, with financial markets anticipating the first interest rate cut in September. However, Fed Chair Jerome Powell emphasized the need for more evidence of decreasing inflation before lowering borrowing costs.
While the job openings rate increased slightly to 4.9%, hires rose by 141,000 to 5.756 million, driven by professional and business services and construction sectors.
Source: Reuters