Job openings are falling, according to figures released yesterday by the Labor Department.
They were down by over 600,000 in February after falling even more the month before. That still leaves nearly 10 million open positions in need of workers — well above pre-pandemic levels.
Later this week we’ll get the Labor Department’s March Employment Report.
Investors and Fed officials will be watching for any further indications that the job market is faltering, amid other signs of economic weakness.
So far, strong job creation and low unemployment have kept the post-pandemic economy humming, said Eric Freedman at U.S. Bank.
“One of the key tenets of the economic resiliency has been strength in the jobs market, and also in real wages,” Freedman said.
Job growth has been so strong, in part, because we’re still building back from a deep hollowing-out early in the pandemic.
“We’re still 3 million jobs below the pre-pandemic trend,” said economist Robert Frick at Navy Federal Credit Union. “Well over a million are in vital industries: healthcare, education, government. There’s another million jobs missing in leisure and hospitality. Americans want to eat out and we want to go on trips.”
Even as employers post fewer job openings, they’re still facing labor shortages, said Jim McCoy at the ManpowerGroup.
“We still have a lot of employers that are struggling to fill mission-critical jobs,” he said.
That includes jobs like registered nurses, software developers and long-haul truckers.
McCoy said economic uncertainty is making employers edgy, and changing how they hire from a staffing firm like his.
“They’re going back to a more traditional approach — bringing on contract workers first, then either converting them, or letting those contracts expire,” he said.
Recently, there’s been a wave of layoffs in tech and media. But other than that, most companies aren’t trimming their workforces — at least not yet.
“You don’t want to actively cut workers — because then you’re not able to keep up with the demand that you have,” said Nationwide economist Ben Ayres. “But maybe you won’t hire as many, or when someone leaves, maybe you won’t hire or replace them right away.”
According to Ayres, businesses are getting more cautious and cost-conscious, trying to protect the bottom line against what might be worse times to come.
“Those much higher interest rates, the potential for a recession down the road — are starting to impact hiring decisions by many businesses,” he said.
Most economists predict a gradual slowdown in job creation — rather than a sharp, quick cratering in the job market any time soon.
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