In May, the US labor market showed unexpected resilience as job openings increased to 8.14 million, up from 7.92 million in April. This growth defied expectations of a decline and signaled ongoing strength in the labor market. The Job Openings and Labor Turnover Survey (JOLTS) also revealed a slight uptick in hires, with 5.8 million made during the month, and a steady quits rate, indicating worker confidence. The ratio of job openings to unemployed workers remained at 1.2, suggesting a normalization of the labor market. Economists had been concerned about potential cracks in the labor market due to rising weekly jobless claims and a steady uptick in the unemployment rate, but the latest data did not support this fear. San Francisco Fed president Mary Daly highlighted the potential for a "benign" slowing outcome in the labor market, emphasizing that further declines in job openings could lead to an increase in the unemployment rate. Overall, the data indicated that the labor market is normalizing rather than rapidly cooling. Despite the pandemic's impact on the labor market, the recent rebound in job openings suggests ongoing demand for labor, with businesses previously facing labor shortages and offering significant raises to attract workers.
