Us job openings fall by highest level in nearly 2 and half years

In August, U.S. job openings fell by the highest level in nearly two and a half years, indicating that the labor market was beginning to cool amidst higher interest rates, aimed at reducing demand and curbing inflation.

According to the U.S. Labor Department, vacancies remained above 10 million for the 14th consecutive month, despite the fifth month of falling job openings this year.

In August, 1.7 job were available for every unemployed person, down from two jobs in July, and redundancies also remained low, which indicates a still tighter labor market, which will encourage the Federal ReserveFederal Reserve to continue its aggressive monetary policy tightening.

As stated by Reuters, the labor market remains healthy even as higher interest rates and inflation, and weaker business and consumer confidence are beginning to tamp down labor market activity, according to Sophia Koropeckyj, senior economist at Moody's Analytics in Westchester, Pennsylvania.

On the last day of August, job openings dropped by 1.1 million to 10.1 million, the lowest level since mid- 2021. Economists polled by Reuters predicted that there would be 10.775 million U.S. job vacancies.

The Midwest, most of the U.S. regions, saw declines. In July, job openings fell to 6.2 percent from 6.8 percent, while hiring increased steadily to 4.1 percent.

The Fed will welcome this apparent decline in excess demand for labor in the hope that it will lessen wage pressures, said Conrad DeQuadros, senior economic advisor at Brean Capital in New York, as quoted by Reuters.

In July, the number of people voluntarily quitting their jobs climbed to 4.2 million from 4.1 million.

Nick Bunker, an analyst at Indeed Hiring Lab, said that the labor market's heat is slowly coming to a slow boil as demand for hiring new workers fades.