The number of job openings in the United States tumbled below 9.6 million in March, the lowest level in about two years.
There were 9.59 million job openings across all sectors that month, according to the Bureau of Labor Statistics Job Openings and Labor Turnover Survey updated Tuesday. The decline is a sign that the labor market, which has held up despite a series of major threats the past two years, is softening.
The largest decreases in job openings were in transportation, warehousing, and utilities. The total number of job openings is the lowest it has been since April 2021.
About 3.9 million workers quit their jobs in March, down slightly from 4 million the month before. The figure is equivalent to about 2.5% of the workforce.
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The so-called quits rate measures the number of people who voluntarily left their jobs and includes those who left their previous employment for another job and people who quit but are confident they will soon find new employment, given the tightness in the labor market.
Also of note in Tuesday’s JOLTs report, layoffs and discharges rose to 1.8 million in March. The layoff rate has now increased to 1.2%. The last time the layoff rate was this high was in December 2020.
The Federal Reserve has been hiking interest rates for more than a year now in an effort to drive down inflation. Doing so is supposed to cause the jobs market to cool, relieving inflationary pressure. The loosening labor market is an outcome that the Fed has been hoping for, and recent employment reports, while still showing job growth, have shown signs of slowing.
In March, 236,000 jobs were added, the Bureau of Labor Statistics reported last month, lower than the average of 334,000 over the last six months (notably, it was the weakest monthly increase since December 2020).
Economists increasingly predict that the economy will fall into a recession at some point this year. Fed staff predicted a mild recession in a presentation to central bank officials at the Federal Open Market Committee’s March meeting, minutes from the meeting recently revealed.
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Top Fed officials are meeting this week and will decide whether to raise rates yet again. Despite the signs of the labor market cooling, it is likely that the central bank will hike rates again by a quarter of a percentage point.
Investors now assign about an 90% chance that the Fed will raise rates yet again, according to CME Group’s FedWatch tool, which calculates the probability using futures contract prices for rates in the short-term market targeted by the Fed.