U.S. Job Openings Dip in June — Labor Market Shows Signs of Moderate Cooling

TradingKey - U.S. job openings declined in June after two consecutive months of increases, signaling a gradual cooldown in the labor market. According to the JOLTS report released Tuesday by the U.S. Bureau of Labor Statistics, the number of open jobs fell to 7.44 million in June, down from a revised 7.71 million in May — below the market expectation of 7.5 million.

The decline was primarily driven by sectors including accommodation and food services, healthcare, and finance & insurance. Despite the drop, job openings remain above pre-pandemic levels, indicating that overall labor demand remains resilient. Currently, there are 1.1 job openings per unemployed worker, a significant narrowing from the 2:1 ratio seen at the peak in 2022, suggesting the labor market is moving toward greater balance.

Hiring activity continued to slow, with the hiring rate falling to 3.3% in June — the lowest level since November of last year. The layoff rate held steady at low levels, and voluntary quits did not rise significantly, reflecting waning worker confidence in finding better opportunities.

While the labor market is showing signs of softening, it remains relatively healthy overall. Federal Reserve Chair Jerome Powell has recently described the job market as “solid,” using that assessment to justify maintaining higher interest rates. He has also highlighted the inflation uncertainty posed by potential new tariffs.

The Fed is set to hold its policy meeting this week, and markets widely expect rates to be held steady. However, some officials have suggested that if employment continues to weaken, the central bank may need to pivot toward rate cuts earlier than anticipated. Friday’s upcoming July nonfarm payrolls report is expected to show slower job growth and a rising unemployment rate — data that could further shift policy expectations.

In a separate release, the Conference Board’s Consumer Confidence Index for July showed an improvement, indicating that public concerns about the economic outlook are beginning to ease. Amid a backdrop of moderating growth and persistent inflationary pressures, the Federal Reserve faces a complex balancing act in setting its next policy move.