Temperature Trend Emerges: US Job Openings Unexpectedly Decrease in June
According to a report from Zhitong Caiping APP, US job openings decreased in June, bringing an end to the previous two-month growth trend and indicating that labor market demand remains stable overall, but with a temperature trend emerging.
According to data released by the Bureau of Labor Statistics (BLS) on Tuesday, job openings decreased to 7.44 million in June, lower than the revised figure of 7.71 million in May. Economists had predicted a value of around 750,000. This reduction involves multiple industries, including accommodation and food services, healthcare, and financial and insurance services, indicating that job demand is slowing down across various sectors.
Although job openings decreased, the current level is still higher than the pre-pandemic average, indicating that employers' overall demand for labor remains healthy. However, the recruitment pace has slowed down, and the time it takes for the unemployed to find new jobs is also lengthening. Data shows that the June hiring rate fell to 3.3%, the lowest since November last year. Meanwhile, layoffs have not changed much, remaining at a low level, and the number of voluntary resignations is relatively small, suggesting that workers' confidence in re-employment is lower than last year.
The job openings to unemployment ratio remains at 1.1, which is an important indicator for the Federal Reserve's monitoring of labor market supply and demand balance. Compared with the peak period in 2022, when this ratio reached 2:1, it reflects that the current labor market is gradually returning to normal.
It's worth noting that some economists have raised questions about the reliability of JOLTS (Job Openings and Labor Turnover Survey) data, citing low response rates and frequent revisions. However, job search website Indeed has released similar indicators showing a decrease in job postings in June, continuing the downward trend seen throughout this year.
This series of employment data is particularly relevant as the Federal Reserve's monetary policy meeting approaches, with labor market conditions being one of the key topics for discussion. Federal Reserve Chairman Powell has previously indicated that the labor market remains "solid," pointing out the uncertainty surrounding the impact of tariffs on inflation as a reason to maintain interest rates unchanged. The market generally expects this meeting to keep interest rates unchanged, but some officials may propose alternative views, advocating support for the employment market which is slowing down.
The report on non-farm employment due out next Friday will provide further clues about the labor market temperature. The market expects the report to show signs of slowing job growth and rising unemployment rates.