The number of available jobs in the United States saw an unexpected increase in April 2023, suggesting underlying strength in the labor market amidst broader economic uncertainty. According to new data released on Tuesday by the Bureau of Labor Statistics, job openings totaled an estimated 7.39 million at the end of April, up from 7.2 million in March.
The monthly Job Openings and Labor Turnover Survey (JOLTS) provides insights into how the US labor market is adapting to the rapidly changing economic landscape. In particular, it reflects job openings, hires, quits, and separations, such as layoffs, as President Donald Trump’s sweeping and often shifting policy actions intensified in April. These developments have caused significant ripples among consumers, businesses, and investors, thereby rekindling fears of a potential recession.
Economists had anticipated that job openings would decline for the third consecutive month, projecting a drop to 7.1 million according to FactSet consensus estimates. However, the unexpected increase in job openings not only indicates a higher demand for workers but may also signify potential “noise” in the economic data, as economists have cautioned.
Monthly data can be notoriously volatile, and this has been particularly true for JOLTS, which has faced challenges like low survey response rates. Robert Frick, a corporate economist with Navy Federal Credit Union, commented that “the numbers still show a gradually slowing but stable jobs market.” He emphasized that the leap in job openings reflects normal fluctuations in the data rather than a significant surge in new positions. Furthermore, he noted that the hiring rate remains within a recent weak range.
April’s report highlighted that job openings increased across most sectors, with notable upswings in arts, entertainment, and recreation; mining and logging; information; and professional and business services. Despite this overall growth, there were significant declines in job postings within the leisure and hospitality sectors, particularly at restaurants and hotels, along with other service-providing businesses.
In addition to job openings, the report indicated that employers are bringing more people on board, with hiring activity reaching its highest rate in seven months. The estimated hires for April stood at 5.57 million, marking the highest level seen in nearly a year, according to BLS data. However, this positive trend is tempered by concerning indicators, particularly a sharp increase in layoffs and discharges.
The number of estimated layoffs surged by nearly 200,000 to 1.786 million, reversing a similar-sized drop observed in March. Despite this increase, the layoff rate as a percentage of total employment remains below pre-pandemic averages. The closely monitored “quits rate,” which serves as a gauge of employee confidence and an indicator of future wage growth, was reported at 2% in April, staying above historical averages. However, the total level of quits has dropped to 3.194 million, marking the lowest rate seen this year.
The typical “churn” associated with a healthy labor market has slowed down since the second half of last year. Economists attribute this slowdown to various factors, including inflation, high interest rates, and increasing uncertainty as the nation approaches elections. This uncertainty has intensified in the first half of the year, particularly following Trump’s series of policy moves, including an erratic approach to tariffs.
Tuesday’s data is just the beginning of a series of crucial economic metrics related to the US labor market, culminating with the highly anticipated jobs report scheduled for Friday. This story is developing and will be updated as new information becomes available.
