Although job openings decreased in the hospitality sector, they rose in state and local government positions as the labour market stabilizes.
Job seekers attend the JobNewsUSA.com South Florida Job Fair, June 26, 2024, in Sunrise, Fla.
In May, the labor market showed minimal change, with the Labor Department reporting on Tuesday that the number of job openings held steady at 8.1 million.
The figure was slightly above expectations but aligns with a labour market that is neither too hot nor too cold. It reflects broader labour market trends indicating that while employers are scaling back their hiring plans, they are not engaging in widespread layoffs as the economy shifts to a slower growth rate.
“The job openings rate remained largely stable at 4.9 percent in May,” the release noted. “There were decreases in job openings in accommodation and food services (-147,000) and private educational services (-34,000). However, job openings increased in state and local government, excluding education (+117,000), durable goods manufacturing (+97,000), and the federal government (+37,000).”
On Wednesday, private payroll company ADP will publish its June survey of employers, with economists predicting an increase of 158,000 jobs following May’s 152,000 gain. On Friday, the government will release the June jobs report, with forecasts expecting a rise of 190,000 jobs, down from the unexpectedly high 272,000 increase in May.
A decelerating labour market is precisely what the Federal Reserve is aiming for as it plans to lower interest rates in the coming months. Recent inflation data has shown improvement, though overall price increases are still above the Fed’s 2% annual target.
Federal Reserve Chairman Jerome Powell, addressing a central bank forum in Portugal on Tuesday, noted that the central bank is observing progress on inflation. However, he emphasized that more improvement is needed before policymakers can feel at ease.
“We’ve made quite a bit of progress and in bringing inflation back down to our target,” Powell said, according to CNBC.
Powell added, “The most recent inflation reading, and to a lesser extent the one before it, indicate that we are returning to a disinflationary trend. We need to be more certain that inflation is consistently moving toward 2% before we begin the process of lowering interest rates.”