March Job Openings Hit Two-Year Low

Layoffs rose sharply, and rate hike announcements are expected.

May 03, 2023

ALEXANDRIA, Va.—Job openings in the U.S. decreased in March to 9.6 million open positions—the lowest level in two years, reports The Wall Street Journal. February saw a revised 10 million vacant jobs, the Labor Department announced earlier this week. Layoffs also spiked to a seasonally adjusted 1.8 million in March, compared to a revised 1.6 million in February.

Job openings have dropped since a record 12 million last March; however, there are far more vacant jobs than there were prior to the pandemic, and there are more open jobs than the 5.8 million unemployed people looking for work.

“The labor market looks to be normalizing, and the big question is whether it stops at ‘normal’ or charges right through it to the point of contraction,” Luke Tilley, chief economist at Wilmington Trust Investment Advisors, told the Journal.

The March job openings numbers come ahead of the Federal Reserve’s monetary policy committee meeting ending today. Jerome Powell, the Fed’s chairman, has often highlighted the imbalance between job openings and available workers, saying it is a leading cause of inflation. It’s expected that the Fed will increase interest rates once again, and it will also decide whether to pause interest-rate increases moving forward, putting the brakes on the fastest rate-raising cycle in 40 years.

March saw 236,000 job openings, which was historically strong but the smallest amount in over two years, while the unemployment rate was close to a 53-year low at 3.5%.

Alyssa Chumbley, owner of an Express Employment Professionals recruitment business, told the Journal that the hiring slowdown reflects cooling overall demand as the economy slows; however, some roles are still hard to fill, especially for skilled manufacturing jobs on evening and night shifts at factories.

“The supply is so small, they’re jumping ship whenever they can to go after the first shift positions,” she said, referring to the 9 a.m. to 5 p.m. work shift. “It’s no longer enough to pay them $5 or $10 an hour more. It’s really the schedule and flexibility, and maintenance technicians have the power to call the shots.”