Key Takeaways

The job market stayed in a now-familiar holding pattern in December, with little hiring, firing, or quitting.

U.S. employers had 7.6 million job openings in December, down from 8.2 million in November, the Bureau of Labor Statistics said Tuesday. That was below the 8 million forecasters had expected, according to a survey of economists by Dow Jones Newswires and The Wall Street Journal .

The Job Market Is Stable and Stagnant

Quitting, hiring, and layoffs stayed at relatively low levels. There were 1.1 open jobs for every unemployed worker, a ratio that has remained unchanged since June.

The Job Opening and Labor Turnover Survey report added details to a separate bureau job market report from December that showed employers adding jobs overall . It painted a picture of a job market that's become stable, if stagnant. The market has cooled down significantly since 2022, when workers were in high demand as the economy recovered from the pandemic. The job slowdown has made it harder for job seekers to find work but hasn't resulted in mass layoffs or a serious rise in unemployment.

There were 1.8 million layoffs, the same as in November and close to historic lows. Hiring ticked up to 5.5 million from 5.4 million the month before, below typical pre-pandemic levels. Meanwhile, 3.2 million quit their jobs, up from 3.1 million in November, which is relatively low by historical standards. The low quitting rate suggests that workers are not optimistic about finding higher pay elsewhere.

What Does the JOLTs Data Mean For the Fed?

The job market remaining stable has implications for the Federal Reserve, which is tasked with using monetary policy to keep employment high and inflation low.

The job market has held steady in recent months, and inflation has stayed stubbornly above the Fed's goal of a 2% annual rate. This prompted the Fed to hold its interest rate at an elevated level at its last meeting in January , keeping upward pressure on all kinds of loans in hopes of discouraging borrowing and pushing inflation down.

Stable employment means the Fed has little reason to cut rates in future meetings to boost the economy.

"The December JOLTS report is consistent with the Fed's view that the labor market is healthy enough to tolerate a more cautious approach to lowering rates," Nancy Vanden Houten, lead U.S. economist at Oxford Economics, wrote in a commentary.

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