U.S. Job Openings Fall to 7.18M in July, Undershooting Expectations — Evening Brief – 09.03.25
Job openings fell to 7.181 million in July, according to the Bureau of Labor Statistics’ Job Openings and Labor Turnover Survey (JOLTs), marking a decline from June’s revised 7.357 million (previously 7.437 million). The figure came in well below the 7.375 million consensus estimate and represents the second-lowest level since the Covid era, surpassed only by September 2024. The openings rate ticked down to 4.3%, from 4.4% in June and 4.5% in July 2024, while the quits rate held at 2.0%, slightly below last year’s 2.1%.
The data signaled a fundamental shift in labor-market dynamics. For much of the post-pandemic period, the U.S. labor market was supply-constrained, with openings consistently exceeding unemployed workers. But July marked a turning point: there were 55,000 fewer job openings than unemployed workers, the first negative print since April 2021. This shift suggests that after four years of relative resilience, labor demand is softening in a way that could weigh on broader economic momentum.
By sector, some of the steepest pullbacks occurred in areas that had been major job creators. Healthcare and social assistance openings fell by 181,000, retail trade declined by 110,000, and arts, entertainment, and recreation slid by 62,000. State and local government openings dropped by 56,000, while professional and business services saw a similar 56,000 decline. In contrast, certain cyclical sectors gained ground: construction added 64,000 openings, and wholesale trade rose by 54,000. Federal government job postings also increased modestly by 18,000.
Despite the sharp fall in openings, the hiring side of the labor market showed some resilience. Total hires rose to 5.308 million in July, up from June’s revised 5.267 million, keeping the hiring rate steady at 3.3%. Layoffs and discharges, however, climbed to 1.784 million, up from 1.661 million the month prior, pushing the layoff rate to 1.1% from 1.0%.
The bond market quickly repriced rate-cut expectations. According to the CME FedWatch tool, the probability of a 25-basis-point cut at the Fed’s September meeting jumped to 97.8%, from 92.7% earlier in the week. Markets also raised the odds of an additional October cut to 52.1%, up from 47.6%. Together, the data underscore growing evidence that the labor market—long a pillar of post-pandemic economic strength—may finally be showing signs of stress.