What’s going on here?
US job openings slipped to 7.2 million in July – the lowest in nearly a year – as firms scaled back hiring plans in health care, retail, and leisure and hospitality.
What does this mean?
The vacancy-to-unemployment ratio fell below 1 for the first time since 2021, meaning there are now fewer job postings than unemployed workers.
What’s more, the pullback wasn’t just in cyclical sectors. Health care and local government – usually reliable sources of jobs – also scaled back. Layoffs ticked higher too, while hiring slowed, showing that employers are turning cautious in the face of changeable tariffs and rising costs.
Why should I care?
For markets: A cut is in the cards.
Investors are already betting on a quarter-point cut by the Federal Reserve (Fed) in September. And with fewer openings for job-hunters, wage growth – a major driver of inflation – could lose steam. Only a seriously positive surprise in Friday’s payrolls data could change the Fed’s mind. Although, looking further ahead, Fed officials are still split on how fast to ease, with some members pushing for multiple cuts before the year’s out.
IN PARTNERSHIP WITH MACRO MORNINGS
