U.S. jobs openings slid in March to the lowest level in more than three years, but stayed at historically high levels in a sign that the job market remains resilient in the face of higher interest rates.
The Labor Department reported Wednesday that employers posted 8.5 million vacancies in March, down from 8.8 million in February and the fewest since February 2021.
The number of Americans quitting their jobs fell to the lowest level since January 2021 — a sign of diminishing confidence in their ability to find something better. But layoffs fell.
Monthly job openings are down sharply from a peak of 12.2 million in March 2022 but remain at a high level. Before 2021, they’d never exceeded 8 million — a threshold they have now reached for 37 straight months.
The high level of job openings reflects a surprisingly strong U.S. labor market. When the Federal Reserve began raising interest rates in March 2022 to combat a resurgence in inflation, the higher borrowing costs were expected to tip the economy into recession and push up unemployment.
Instead, even as the Fed raised its benchmark rate 11 times, the economy kept growing, companies kept hiring and unemployment stayed low, coming in under 4% for 26 straight months — longest such streak since the 1960s. Employers have added a healthy average of 276,000 jobs a month this year — up from last year’s 251,000 — and Friday’s April jobs report is expected to show they tacked on another 230,000 last month, down but still solid, according to a survey of forecasters by the data firm FactSet.
Inflation eased, too — decelerating from a four-decade high 9.1% in June 2022 to 3.5% in March. The combination of falling inflation and enduring economic strength has raised hopes the Fed can manage a so-called soft landing —slowing the economy enough to tame inflation without causing a recession. Some economists have suggested there need be no landing at all: The economy can keep growing steadily as inflation comes down.
But progress on inflation has lately stalled. On a month-to-month basis, consumer price increases haven’t fallen since October. And on a year-over-year basis, they remain well above the Fed’s 2% target.
The Fed had signaled that it expects to reverse course and cut rates three times this year. But, given the disappointing inflation numbers, the central bank appears to be in no hurry to start: It’s expected to leave rates alone at its meeting Wednesday.
Department of Labor Statistics
The number of job openings changed little at 8.5 million on the last business day of March, the U.S.
Bureau of Labor Statistics reported today. Over the month, the number of hires changed little at 5.5 million while the number of total separations decreased to 5.2 million. Within separations, quits (3.3 million) and layoffs and discharges (1.5 million) changed little. This release includes estimates of the number and rate of job openings, hires, and separations for the total nonfarm sector, by industry, and by establishment size class.
Job Openings
On the last business day of March, the number of job openings changed little at 8.5 million; this measure was down by 1.1 million over the year. The rate was little changed at 5.1 percent in March. Job openings decreased in construction (-182,000) and in finance and insurance (-158,000), but increased in state and local government education (+68,000).
Hires
In March, the number of hires was little changed at 5.5 million but was down by 455,000 over the year. The rate, at 3.5 percent, changed little in March.
Separations
Total separations include quits, layoffs and discharges, and other separations. Quits are generally voluntary separations initiated by the employee. Therefore, the quits rate can serve as a measure of workers’ willingness or ability to leave jobs. Layoffs and discharges are involuntary separations initiated by the employer. Other separations include separations due to retirement, death, disability, and transfers to other locations of the same firm.
The number of total separations in March decreased to 5.2 million (-339,000). The rate changed little at 3.3 percent. Over the month, the number of total separations increased in private educational services (+21,000).
In March, the number of quits was little changed at 3.3 million but was down by 480,000 over the year. The rate was little changed at 2.1 percent in March. The number of quits decreased in other services (-59,000).
In March, the number and rate of layoffs and discharges changed little at 1.5 million and 1.0 percent, respectively. The number of layoffs and discharges decreased in arts, entertainment, and recreation (-39,000) but increased in private educational services (+18,000). The number of other separations was little changed in March at 345,000.
Establishment Size Class
In March, establishments with 1 to 9 employees and establishments with 5,000 or more employees saw little change in their job openings rate, hires rate, and total separations rate.
February 2024 Revisions
The number of job openings for February was revised up by 57,000 to 8.8 million, the number of hires was revised down by 37,000 to 5.8 million, and the number of total separations was revised down by 20,000 to 5.5 million. Within separations, the number of quits was revised up by 43,000 to 3.5 million and the number of layoffs and discharges was revised down by 43,000 to 1.7 million. (Monthly revisions result from additional reports received from businesses and government agencies since the last published estimates and from the recalculation of seasonal factors.)
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The Job Openings and Labor Turnover Survey estimates for April 2024 are scheduled to be released on Tuesday, June 4, 2024, at 10:00 a.m. (ET).
