Job openings hit lowest level in 2 years as demand for workers cools

Published

2 years ago

August 9, 2023

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US employers posted fewer jobs in June, a sign that thered-hot demand for workersthat has been a key feature of the post-pandemic economy is cooling a bit.

Job openings dropped to 9.6 million in June, the Labor Department said Tuesday, down slightly from the previous month but much lower than the 10.3 million in April and the fewest in more than two years.

The governments report also showed that the number of people who quit their jobs in June fell sharply to 3.8 million from 4.1 million, another sign the job market is slowing.

The Federal Reserve is seeking to cool the job market, because if companies are less desperate to hire, and fewer workers are quitting to seek higher-paying positions elsewhere, then businesses will be under less pressure to raise pay to find and keep workers.

Smaller pay hikes could help lower inflation, since businesses wont have to lift their prices to offset higher labor costs.

Tuesdays report means there are 1.6 jobs for every unemployed worker, down from a peak of 1.9 earlier this year, though still higher than before the pandemic.

On Friday, the government is set to release the July jobs report, which will show how many positions were added in July and whether the unemployment rate fell below its current level of 3.6%, which is near the lowest in a half-century.

Economists forecast the report will show a gain of 200,000 jobs, with the unemployment rate unchanged, according to a survey by data provider FactSet.

Since the economy first emerged from the pandemic, job openings have soared reaching a record 12 million in March 2022.

Before the pandemic, they had never topped 7.6 million.

Average paychecks rose by 4.6% in the April-June quarter compared to a year earlier, above the pre-pandemic pace of about 3%.

While thats great for workers, the Fed worries that unless companies become more productive, such increases are too high to get inflation to its 2% target.

The Fed last week lifted its key short-term rate for the 11th time in 17 months as part of its ongoing efforts to curb inflation, which is currently at 3%.

Excluding the volatile food and energy categories, however, according to the Feds preferred measure, it rose 4.1% compared with a year ago.

Most economists would have expected such a sharp increase in interest rates to force widespread layoffs and higher unemployment.

Instead, the unemployment rate has barely changed since the Fed began pushing up borrowing costs last year.

Fed Chair Jerome Powell has long held out hope that the higher rates, instead of leading to more layoffs, would simply cause employers to post fewer openings.

At a press conference last week, Powell said that the job market has softened, which should help bring down inflation, through job openings coming down part of the way back to more normal levels.

Typically, when job openings decline, companies also start to lay off workers and push up the unemployment rate.

But so far, thats not happening. Tuesdays report, known as the Job Openings and Labor Turnover Survey, showed that layoffs actually declined in June, to 1.53 million, down from 1.57 million in May.

That is below pre-pandemic trends and suggests companies generally want to hold onto their staffs.

Politics

Collapsed crypto firm Ziglu faces $2.7M deficit amid special administration

Published

4 hours ago

July 13, 2025

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Collapsed crypto firm Ziglu faces .7M deficit amid special administration

Thousands of savers face potential losses after a $2.7 million shortfall was discovered at Ziglu, a British crypto fintech that entered special administration.

Politics

Heidi Alexander says ‘fairness’ will be government’s ‘guiding principle’ when it comes to taxes at next budget

Published

6 hours ago

July 13, 2025

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Heidi Alexander says 'fairness' will be government's 'guiding principle' when it comes to taxes at next budget

Another hint that tax rises are coming in this autumn’s budget has been given by a senior minister.

Speaking to Sunday Morning with Trevor Phillips, Transport Secretary Heidi Alexander was asked if Sir Keir Starmer and the rest of the cabinet had discussed hiking taxes in the wake of the government’s failed welfare reforms, which were shot down by their own MPs.

Trevor Phillips asked specifically if tax rises were discussed among the cabinet last week – including on an away day on Friday.

Politics Hub: Catch up on the latest

Tax increases were not discussed “directly”, Ms Alexander said, but ministers were “cognisant” of the challenges facing them.

Asked what this means, Ms Alexander added: “I think your viewers would be surprised if we didn’t recognise that at the budget, the chancellor will need to look at the OBR forecast that is given to her and will make decisions in line with the fiscal rules that she has set out.

“We made a commitment in our manifesto not to be putting up taxes on people on modest incomes, working people. We have stuck to that.”

Ms Alexander said she wouldn’t comment directly on taxes and the budget at this point, adding: “So, the chancellor will set her budget. I’m not going to sit in a TV studio today and speculate on what the contents of that budget might be.

“When it comes to taxation, fairness is going to be our guiding principle.”

👉Listen to Politics at Sam and Anne’s on your podcast app👈      

Afterwards, shadow home secretary Chris Philp told Phillips: “That sounds to me like a barely disguised reference to tax rises coming in the autumn.”

He then went on to repeat the Conservative attack lines that Labour are “crashing the economy”.

Mr Philp then attacked the prime minister as “weak” for being unable to get his welfare reforms through the Commons.

Discussions about potential tax rises have come to the fore after the government had to gut its welfare reforms.

Sir Keir had wanted to change Personal Independence Payments (PIP), but a large Labour rebellion forced him to axe the changes.

With the savings from these proposed changes – around £5bn – already worked into the government’s sums, they will now need to find the money somewhere else.

The general belief is that this will take the form of tax rises, rather than spending cuts, with more money needed for military spending commitments, as well as other areas of priority for the government, such as the NHS.

UK

Heidi Alexander says ‘fairness’ will be government’s ‘guiding principle’ when it comes to taxes at next budget

Published

6 hours ago

July 13, 2025

admin

Another hint that tax rises are coming in this autumn’s budget has been given by a senior minister.

Trevor Phillips asked specifically if tax rises were discussed among the cabinet last week – including on an away day on Friday.

Politics Hub: Catch up on the latest

Tax increases were not discussed “directly”, Ms Alexander said, but ministers were “cognisant” of the challenges facing them.

“We made a commitment in our manifesto not to be putting up taxes on people on modest incomes, working people. We have stuck to that.”

“When it comes to taxation, fairness is going to be our guiding principle.”

👉Listen to Politics at Sam and Anne’s on your podcast app👈      

Afterwards, shadow home secretary Chris Philp told Phillips: “That sounds to me like a barely disguised reference to tax rises coming in the autumn.”

He then went on to repeat the Conservative attack lines that Labour are “crashing the economy”.

Mr Philp then attacked the prime minister as “weak” for being unable to get his welfare reforms through the Commons.

Discussions about potential tax rises have come to the fore after the government had to gut its welfare reforms.

Sir Keir had wanted to change Personal Independence Payments (PIP), but a large Labour rebellion forced him to axe the changes.

With the savings from these proposed changes – around £5bn – already worked into the government’s sums, they will now need to find the money somewhere else.