US labor market loosening as job openings approach two-year low
Business
Job openings fell by 1.3 million in first two months of this year
WASHINGTON (Reuters) - U.S. job openings dropped to their lowest level in nearly two years in February, suggesting that labor market conditions were finally easing, welcome news for the Federal Reserve as it considers whether to pause its interest rate hiking cycle.
Despite the larger-than-expected decline in job vacancies reported by the Labor Department on Tuesday, the labor market remains tight, with 1.7 job openings for every unemployed person in February, down from 1.9 in January. Fed officials have been closely monitoring this ratio. Friday's employment report for March will shed more light on the labor market's health.
The broad drop in job openings occurred before the recent financial market turmoil, which led to tighter credit conditions and sparked fears of widespread job losses in the economy.
Job openings, a measure of labor demand, were down 632,000 to 9.9 million on the last day of February, the lowest level since May 2021, the monthly Job Openings and Labor Turnover Survey, or JOLTS report, showed. They fell 1.3 million in first two months of this year.
Economists polled by Reuters had forecast 10.4 million job openings. The decline was led by the professional and business services sector, where job openings fell 278,000. There were 150,000 fewer vacancies in the healthcare and social assistance industry. Job openings in the transportation, warehousing and utilities sector fell by 145,000.
But the construction industry sought more workers, with job openings increasing by 129,000. There were an additional 38,000 vacancies in the arts, entertainment and recreation sector.
Regionally, the decline was concentrated in the Midwest, South and West. The Northeast reported a moderate drop.
