The labor market remains stagnant, as job openings increased only slightly in August and hiring declined.
Job openings totaled 7.23 million in August, according to data from the Bureau of Labor Statistics released Tuesday, just a bit higher than the 7.21 million vacancies seen in July.
The hiring rate also ticked lower last month, reaching its lowest point since June 2024, while the rate of people voluntarily leaving their jobs slid to its lowest level so far this year, underscoring a frozen labor market in which out-of-work Americans are struggling to gain footing.
“Yikes. The official US ‘hiring rate’ fell to 3.2% in August,” Heather Long, chief economist at Navy Federal Credit Union, wrote on X, calling the pace of hiring an “anemic level” that, apart from one month last year and another low month in April 2020, hadn’t been seen since the Great Recession.
“The job market is frozen,” Long wrote. “Americans feel stuck. And it appears to be getting worse.”
Indeed, consumers’ sentiment about the state of the labor market has been souring, though the overall unemployment rate has remained relatively low at 4.3%.
Read more: What is consumer confidence, and why does it matter?
Still, even as the pace of job growth has slowed and unemployment has risen only slightly, the supply of labor is also softening as “net immigration into the US, an important contributor to workforce growth, has dropped sharply,” US Federal Reserve Vice Chair Philip Jefferson said in a speech Monday.
“A low level of job creation would historically put upward pressure on the unemployment rate, though so far that effect has been muted because of the decline in labor force growth,” Jefferson said.
Economists with the Economic Policy Institute similarly noted Tuesday that while recent data revisions have suggested the labor market was weaker than expected last year, much of the slower job growth was “the result of smaller working-age population growth due to reduced immigration and the aging of the workforce,” rather than there being fewer opportunities available.
This year, though, there are some warning signs that the market is deteriorating.
“There has been a marked decline in payroll employment growth — averaging only 29,000 jobs per month since May,” the economists said. “Nominal wages are still rising faster than inflation, but the pace of private-sector real wage growth is half as fast as it was three months ago.”
Meanwhile, “layoffs remain low and regular state unemployment insurance claims aren’t rising, but federal unemployment insurance claims are about twice as high as they were last year at this time,” they added.