Job openings dropped more than expected in March to lowest level in 2 years
U.S. job openings tumbled in March to the lowest level in two years, the latest evidence that the Federal Reserve’s aggressive interest-rate hike campaign is finally starting to cool the once red-hot labor market.
The Labor Department said Tuesday that there were 9.6 million job openings in March, a decline from the 9.9 million openings reported in the previous month. Economists surveyed by Refinitiv expected openings to fall to 9.7 million.
At the same time, the number of layoffs surged to more than 1.8 million, an increase of 248,000 from the previous month.
The Federal Reserve closely watches these figures as it tries to gauge labor market tightness and wrestle inflation under control.
“Job openings fell sharply again in March, another sign the labor market is getting less tight,” said Bill Adams, chief economist for Dallas-based Comerica Bank. “The Fed will welcome lower job openings. [But] they’re still concerned about labor demand exceeding supply and keeping inflation high.”
The central bank has responded to the inflation crisis and the extremely tight labor market by raising interest rates at the fastest pace in decades. Officials have raised interest rates nine times so far over the past year and are widely expected to approve a tenth increase at the conclusion of their two-day meeting on Wednesday.
The number of Americans quitting their jobs, meanwhile, also dropped to 3.9 million, or roughly 2.5% of the workforce. It marked the lowest level since May 2021, an early sign that a trend dubbed the “Great Resignation” is beginning to dissipate.
Switching jobs has been a windfall for many workers over the past year: Roughly 49% of job-switchers saw their real hourly wage increase faster than inflation last year, compared with just 42% of workers who stayed in the same job, according to recent Atlanta Fed data.