US job openings dip to 9.8 million, showing resilience in labour market

By Paul Wiseman

US job openings slipped in May but remained at levels high enough to illustrate that the American labour market remains resilient in the face of sharply higher interest rates.

Employers posted 9.8 million job vacancies, down from 10.3 million in April, the Labour Department said on Thursday.

But layoffs fell slightly, and more Americans quit their jobs — a sign they were confident they could find better pay or working conditions elsewhere.

Monthly job openings remain high by historic standards — they had never hit 8 million before 2021 — despite the Federal Reserve's aggressive campaign to cool the American labour market and slow the economy to combat inflation that last year hit four-decade highs.

The Fed has hiked its benchmark short-term interest rate 10 times since March 2022.

The higher borrowing costs have had an impact: Economic growth has slowed, and monthly job openings are down from their March 2022 peak of 12 million, highest on record.

Inflation is down, too: Consumer prices were up 4 per cent in May from a year earlier, down from a year-over-year peak of 9.1 per cent in June 2022 but still double the Fed's 2 per cent target.

Economists have long predicted the United States would tumble into recession this year. But the job market's persistent sturdiness has raised doubts about whether a downturn is inevitable after all.

Employers have added a strong 314,000 jobs a month this year, and at 3.7 per cent in May, the unemployment rate is not far off a half-century low.

The Labour Department on Friday releases its employment report for June. Forecasters surveyed by the data firm FactSet expect that payrolls rose by another 205,000 last month and that unemployment dipped to 3.6 per cent.