US Job Openings Slide in July, Signaling Slowing Momentum
30 Aug 2023
30 Aug 2023 by Luke Puplett - Founder
Job Openings Slide in July, Signaling Slowing Momentum
The latest Job Openings and Labor Turnover Survey (JOLTS) report from the Bureau of Labor Statistics shows job openings decreased by 338,000 to 8.8 million in July. The drop in openings signals a cooling job market as economic uncertainty grows.
The job openings rate edged down 0.2 percentage points to 5.3% in July, as openings declined across most industries. Openings in professional and business services saw the largest monthly drop, falling by 198,000. Healthcare openings also slid 130,000 while state and local government education declined 62,000.
Other major industries seeing declines in openings included construction (23,000 fewer openings), manufacturing (30,000 fewer), and information (27,000 fewer). Transportation/warehousing and utilities was one bright spot, gaining 75,000 openings.
Compared to last July, job openings are down significantly across most sectors. Openings in professional/business services have plunged 36.5% year-over-year. Trade/transportation/utilities openings are down 16% from a year ago.
The falling openings coincide with other signs of slowing momentum, including declines in retail sales and manufacturing production. Businesses appear to be pulling back on hiring plans as high inflation and rising interest rates dampen economic activity.
While layoffs remain low for now, the decrease in openings does not bode well for the labor market outlook. Analysts say openings above 7 million reflect a healthy job market. The drop below 8.8 million in July suggests employers are growing more cautious in their hiring. Further declines could signal more job losses ahead.
It's important to note these declines in openings are coming off extremely elevated levels in 2021 and early 2022, as the economy reopened post-pandemic with massive stimulus still in the system. Openings hit a record high of 11.9 million in March 2022 before pulling back over the last several months. So the drops, while notable, are coming off unsustainably strong numbers during the reopening. The labor market remains tight historically, even if momentum is slowing from last year's breakneck pace.
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