CNN
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The “wait-and-see” is turning into a “just-can’t-wait-anymore.”
US employers moved forward on plans to increase their workforces in May, with the number of available jobs rising to a six-month high, according to Bureau of Labor Statistics data released Tuesday.
Job openings, which serve as a closely watched measure of labor market demand, totaled an estimated 7.77 million at the end of May, rising from 7.4 million in April, according to the BLS’ latest Job Openings and Labor Turnover Survey.
Economists were expecting the number of available jobs to retreat after unexpectedly bouncing higher in April, reflecting an environment where uncertainty has frozen some businesses in their tracks. Consensus estimates were for job openings to total 7.3 million last month, according to FactSet.
Instead, they rose for the second month in a row.
“Business leaders are put in a position now where they have to make decisions in the short term,” Allison Shrivastava, an economist at the Indeed Hiring Lab, told CNN in an interview.
Still, Shrivastava cautioned that monthly economic data can be quite volatile (especially from survey-drawn reports like JOLTS that have seen weaker response rates). Job postings tracked by Indeed have remained fairly flat, she noted.
“I wouldn’t take this as a sign of blue skies ahead, by any means,” she added.
Some of the most substantial increases in job postings were at restaurants and hotels, which saw a surge (+314,000) in advance of the summer travel season after openings in that sector hit a low-water mark in April. The finance and insurance industry also saw a sizeable upswing in job openings, Tuesday’s data showed.
While overall hiring activity remained fairly tepid in May — hiring rates were flat or down across most industries — the accommodation and food services sector filled open jobs at a pace last seen in the summer of 2023, a potential indication that there’s optimism that consumers will still continue to spend, especially in discretionary areas, despite broadening economic uncertainty.
President Donald Trump’s sweeping policy moves — including heightened tariffs, moves to reduce immigration, and reduction in federal spending and workers — as well as increased geopolitical tension, have injected incredible uncertainty into the US economy, sending markets on a roller coaster ride, rattling consumers and freezing some business decisions.
It may take some time for these moves, especially on immigration, to be reflected in labor market data, Shrivastava said.
Tuesday’s data is the first in a series of critically important economic metrics released this week about the labor market, culminating with the June jobs report that’s due out on Thursday morning.
Economists are expecting job gains to slow from May, with an estimated 115,000 positions added in June, according to FactSet. They also are forecasting that the unemployment rate will rise to 4.3% from 4.2%.
The monthly JOLTS report showed how US labor market turnover activity is faring at a time when concern is growing that job growth may be slowing too much.
“As tariff worries fade, businesses are adopting a more optimistic view and are looking to bring on more workers,” Heather Long, chief economist at Navy Federal Credit Union, wrote on Tuesday. “Hiring has been stuck at unusually low levels for over a year. But there’s hope the ‘white-collar job recession’ could finally end as finance and insurance firms are posting more roles.”
Tuesday’s data showed that the labor market remains a bit gridlocked as the churn seen in stronger economic times has slowed. The hiring rate (as a percentage of total employment) continues to hover near 10-year lows.
The closely watched “quits rate,” which serves as both a gauge of employee confidence as well as an indicator of future wage growth, was 2.1% in May, remaining well below the average rate of the past five years.
However, despite the stalling in hiring and quitting, layoff activity hasn’t significantly accelerated.
Layoffs fell in May to 1.6 million, staying below pre-pandemic levels. The rate of layoffs remains near record lows, according to BLS JOLTS data that dates back to December 2000.
