US job openings drop to 6.5 million, lowest since 2020, signalling continued labour market weakness
US job vacancies declined to their lowest level in more than five years in December, underscoring persistent softness in the labour market despite strong economic growth, according to AP.Data released by the US Labor Department showed job openings fell to 6.5 million in December from 6.9 million in November, marking the lowest level since September 2020. The figure also came in below economists’ expectations. Layoffs edged higher during the period, while the number of people voluntarily quitting jobs — an indicator of worker confidence — remained broadly unchanged at 3.2 million.The data highlights a widening gap between economic expansion and hiring momentum. While gross domestic product grew at its fastest pace in two years during the July–September quarter, job creation has slowed significantly. Employers have added an average of just 28,000 jobs per month since March, compared with roughly 400,000 monthly additions during the post-pandemic hiring surge between 2021 and 2023.Upcoming labour market data is expected to show modest improvement. Economists anticipate that January employment numbers, due next week, may show around 70,000 new jobs added, up from 50,000 in December.Recent private data has also pointed to subdued hiring conditions. Payroll processor ADP reported that private sector employers added only 22,000 jobs last month, far below market forecasts. Separately, outplacement firm Challenger, Gray & Christmas said companies announced more than 108,000 job cuts, the highest monthly total since October and the weakest January reading since 2009.Commenting on the trend, Heather Long, chief economist at Navy Federal Credit Union, said: “The hiring recession isn’t going to end anytime soon. Job openings in December just fell to their lowest level since September 2020. It’s yet another sign of how little hiring – or interest in hiring – is happening in this economy.”Economists remain divided on the outlook, debating whether hiring will eventually pick up to match strong economic growth, whether growth may slow to reflect labour market weakness, or whether advances in artificial intelligence and automation could allow output to expand without significant job creation.
