U.S job openings dropped significantly in April, with the number of available jobs per job seeker hitting its lowest level in nearly three years.
This shift suggests a softening labor market, which could assist the Federal Reserve in its efforts to curb inflation.
The Labor Department’s Bureau of Labor Statistics reported a decrease of 296,000 job openings, bringing the total to 8.059 million at the end of April.
This figure is the lowest since February 2021.
The job openings rate, a crucial measure of labor demand, showed 1.24 openings per unemployed person.
This is down from 1.3 in March.
This ratio has been at its lowest since June 2021 and aligns with pre-pandemic levels.
Rubeela Farooqi, chief US economist at High Frequency Economics, said: “The Fed’s challenge will be to maintain rates at a level that keeps inflation in check while preventing a significant weakening in the labor market.”
Economists had forecast 8.355 million job openings for April.
Job vacancies, which peaked at a record 12 million in March 2022, were revised to 8.355 million from an initial 8.488 million in March.
The number of people quitting their jobs rose by 98,000 to 3.507 million in April
The drop in openings was widespread and affected most sectors, though increases were seen in professional services, private education, retail, finance and insurance, and transportation.
Despite the decline in openings, the labor market did not show signs of severe weakening.
The number of people quitting their jobs rose by 98,000 to 3.507 million in April.
This maintained a quits rate of 2.2 percent for the sixth consecutive month, the lowest since September 2020.
Layoffs were at 1.52 million, the lowest since December 2022.
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Federal Reserve officials are expected to keep the central bank’s policy rate steady at 5.25 percent to 5.50 percent in their upcoming meeting.
A rate cut is expected only if a significant labor market downturn exists.
They have welcomed the cooling labor market as it eases pressure on prices.
Attention now shifts to the May jobs report, due Friday.
It is expected to show an unemployment rate of 3.9 percent.
Financial markets are predicting a rate cut by the Fed in September, with another possible cut in December.
US manufacturing orders increased for the third straight month in April.
This is driven by demand for transportation equipment, signaling continued strength in the sector.
