January Job Openings Rise, But Signs of Weakness Persist

Following a significant decrease in December, job openings rose in January from 7.5 million to 7.7 million, slightly surpassing expectations. This increase was particularly noticeable in the retail and finance sectors; however, professional and business services, as well as leisure and hospitality, experienced marked declines. Both the hiring rate of 3.4% and quits rate of 2.1% neared their lowest points in a decade, excluding the COVID-19 period. This reduced hiring rate complicates the job search for unemployed individuals, while the decline in quits reflects a lack of confidence in securing new opportunities.

What’s the bottom line?
Although January registered an uptick in job openings, the data reveals underlying weaknesses in the labor market. Overall, job openings continue to trend downward, considerably below the peak of 1.2 million in 2022. Additionally, the report included revisions that lowered job openings for all of 2024 by an average of 263,000 per month. Plus, job listings may even be overstated, as the rise of remote work has resulted in postings across multiple states, likely contributing to an overcount in the JOLTS data.