WASHINGTON (AP) — U.S. job openings rose unexpectedly in May, a sign that the American labor market remains resilien t in the face of high borrowing costs and uncertainty over U.S. economic policy.
U.S. employers posted 7.8 million vacancies in May, the Labor Department reported Tuesday, up from 7.4 million in April and the highest November’s 8 million, when former President Joe Biden was still in the White House. Economists had expected a slight decrease to 7.3 million. Openings were reported at hotels and restaurants and at finance companies. Vacancies at the federal government fell to the lowest level since May 2020, likely reflecting President Donald Trump’s hiring freeze.
The Labor Department’s Job Openings and Labor Turnover Survey (JOLTS) report showed that the number of Americans quitting their job — a sign of confidence in their prospects — rose modestly, and layoffs fell.
However, the report showed that hiring fell in May, suggesting that employers, though reluctant to lose staff, are hesitant about adding workers amid uncertainty over the economy.
“Hiring remains depressed, but that is less worrisome than it would be otherwise because layoffs continue to be low,” Nancy Vanden Houten, lead U.S. economist at Oxford Economics, wrote in a commentary.
Openings are high by historical standards but have come down sharply since peaking at a record 12.1 million in March 2022.
The U.S. job market has steadily decelerated from hiring boom of 2021-2023 when the economy bounced back from COVID-19 lockdowns. The unexpectedly strong post-pandemic recovery ignited inflation, prompting the Federal Reserve to raise its benchmark interest rate 11 times in 2022 and 2023.
The higher borrowing costs have gradually cooled the labor market, and President Donald Trump’s policy of taxing imports at high rates has added uncertainty to the hiring outlook.
The Labor Department is expected to report Thursday that the U.S. economy generated 117,000 jobs last month, according to a survey of forecasters by the data firm FactSet. That would be down from 139,000 in May, from an average 168,000 a month in 2024 and a from a monthly average of 400,000 from 2021 through 2023. The unemployment rate is forecast to tick up to a still-low 4.3% from 4.2% in May.
Read the full article here