May 2, 2023 - Economy

New JOLTS data suggest a cooling labor market

Data: Department of Labor; Chart: Axios Visuals

Employers continue to scale back demand for workers, while quit rates declined and layoffs ticked up — two signs that the labor market may be loosening up.

Driving the news: Job openings declined for the third straight month, with vacancies dropping to 9.6 million in March — 384,000 fewer postings than in February, the Labor Department said Tuesday morning in its monthly Job Openings and Labor Turnover Survey.

  • Quits are retreating to the levels seen pre-pandemic. The quit rate among private sector workers was 2.7% in March, down from its 3.3% peak in April of last year, and almost back to the 2.6% seen in January 2020.
  • High quits are a sign of confidence among workers about the prospects of finding another job with (likely) higher pay, economists say. The slowdown in quitting may be beginning to signal the opposite.

What to watch: The number of layoffs increased by 1.8 million in March, edging up to pre-pandemic levels.

  • Among the sectors that saw the sharpest jump in layoffs: construction, where layoffs jumped by 112,0000.

The bottom line: There were 1.6 open jobs for every unemployed worker in America in March — a ratio that has eased in recent months but remains higher than at any time before the pandemic.

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