The job market remains stuck in neutral, with job openings rising slightly in July after a downward revision to June’s number, the Bureau of Labor Statistics said on Tuesday.
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The job openings report found that there were 7.3 million openings, about 100,000 more than the downwardly revised reading of 7.2 million in June. Hires and quits, a key measure of labor turnover, remained steady, showing that fewer people are moving jobs as they did in the years following COVID-19.
“Net, net, employment opportunities remain lower than earlier this year even if job openings ticked up modestly at the end of July,” Chris Rupkey, chief economist at fwd.bonds, wrote Tuesday. “Openings rose 89K to 7.271 million across the nation in July with healthcare and social assistance needing 54K more workers. White collar professional and business services have sharply cut back their need for workers with openings of 1.138 million in July down from 1.473 million as recently as April as the Iran war uncertainty weighs on the outlook.”
The report comes a day before private payroll firm ADP releases its monthly employer survey for August and two days before the government reports the August job number. Forecasts are for that to come in around 50,000 jobs added after a disappointing loss of 23,000 in July.
Some other reports show similar results. Paychex data released Tuesday show that small business hiring is holding steady.
“Weekly hours worked grew for the sixth consecutive month, the longest positive stretch since October 2020,” the report said. “Employers are seeing demand but leaning on the staff they already have rather than adding headcount, which is a useful counterpoint to the flat job growth numbers.”
Gusto’s small business hiring survey found employers added 29,500 jobs in August while pay rose at an annual rate of 3.9%. However, that is a cooling from the 12-month average of 41,700.
The Federal Reserve recently described the labor market as balanced and Chairman Kevin Warsh appears more concerned with persistent inflation. At 3.4% for the consumer price index in July, prices are running well above the central bank’s 2% target. Some market analysts foresee the Fed lifting interest rates at its next meeting in September.
While President Donald Trump and Treasury Secretary Scott Bessent have touted the economy’s performance, the reality is slow growth in gross domestic product and heightened inflation are affecting the broad economy. In the meantime, massive investments in artificial intelligence are driving the stock market – a barometer Trump mentions frequently – but those gains are largely going to higher income Americans.
Consumers still seem more concerned about high prices for necessities such as gasoline, electricity and food. Polls show that the GOP and Trump are likely to lose control of the House in November, with some Republican Senate seats ranked as toss-ups.
“Growth is still moving forward and the unemployment rate remains low, but the data increasingly point to a sluggish backdrop rather than an economy firing on all cylinders,” Bret Kenwell, U.S. analyst at eToro, wrote on Tuesday.