Job openings hit lowest level in two years as Fed weighs more rate hikes
A hiring sign seeking bus drivers is posted in Palatine, Ill., Wednesday, April 19, 2023. On Tuesday, the Labor Department reports on job openings and labor turnover for March.(AP Photo/Nam Y. Huh)
The number of open jobs in the economy decreased to 9.6 million in March, down from 9.9 million on the last day in February, as concerns about a recession later this year hung over the economy, according to data released Tuesday by the Labor Department.
The 9.6 million open jobs in the economy are the lowest number since April 2021.
The February Job Openings and Labor Turnover Survey (JOLTS) report was in line with the economists’ expectations and left the ratio of available jobs to job seekers unchanged from February to March at about 1.6 to 1 — conditions that are still beneficial to workers.
The increased rate at which people have been leaving jobs and moving to new ones has been bolstered by a remarkably strong labor market during the recovery from the pandemic.
The unemployment rate is still near a 50-year low at 3.5 percent, with numbers for March to be reported on Friday.
But layoffs and firings ticked up in March by 248,000 to 1.8 million. Layoffs increased in construction by 112,000, in food service by 63,000, and in health care by 42,000.
The layoff rate increased to 1.2 from 1.0 from February to March, but it had decreased the month prior, indicating a lack of a definitive trend.
The highest number of job openings in March were in education and health services, professional and business services, as well as health care and social assistance, which can include jobs like social workers and nursing home attendants.
The hiring rate in the economy held fast from February to March at 4 percent with 6.1 million people hired for new jobs. Sectors that outperformed the average hiring rate included entertainment and recreation jobs in the leisure and hospitality sector as well as construction jobs.
The numbers come as the Federal Reserve is set to announce another interest rate increase on Wednesday at a meeting of its Federal Open Markets Committee. A prediction algorithm by financial company CME put the chances of another rate hike at 90 percent on Tuesday while the chances of staying in the current range were around 10 percent.
A spate of U.S. and European bank failures that have prompted various public and private-sector bailouts are making the economic outlook for later this year less certain, and the Fed has been predicting a “mild” recession.
“Historical recessions related to financial market problems tend to be more severe and persistent than average recessions,” the minutes of the latest rate-setting committee meeting read.