US Job Openings Fall as Demand for Workers Weakens

A retail store advertising a full-time job on its open door in Oceanside, California, US, May 10, 2021. Photo by Mike Blake/REUTERS
A retail store advertising a full-time job on its open door in Oceanside, California, US, May 10, 2021. Photo by Mike Blake/REUTERS
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US Job Openings Fall as Demand for Workers Weakens

A retail store advertising a full-time job on its open door in Oceanside, California, US, May 10, 2021. Photo by Mike Blake/REUTERS
A retail store advertising a full-time job on its open door in Oceanside, California, US, May 10, 2021. Photo by Mike Blake/REUTERS

America’s employers posted fewer job openings in July than they had the previous month, a sign that hiring could further cool in the coming months.
The Labor Department reported Wednesday that there were 7.7 million open jobs in July, down from 7.9 million in June and the fewest since January 2021. Openings have fallen steadily this year, from nearly 8.8 million in January, according to the Associated Press.
Layoffs rose from 1.56 million to 1.76 million, the most since March 2023, though that level of job cuts is roughly consistent with pre-Covid 19 levels, when the unemployment rate was historically low.
Layoffs have been unusually low since the economy’s rapid recovery from the pandemic recession, with many employers intent on holding onto their workers.
Overall, Wednesday’s report painted a mixed picture of the job market. On the positive side, total hiring rose in July, to 5.5 million, after it had fallen to a four-year low of 5.2 million in June.
And the number of people who quit their jobs ticked up slightly, to about 3.3 million.
The number of quits is seen as a measure of the job market’s health: Workers typically quit when they already have a new job or when they’re confident they can find one.
Still, quits remain far below the peak of 4.5 million reached in 2022, when many workers shifted jobs as the economy accelerated out of the pandemic recession.
July’s figures indicate that fewer companies are seeking to add workers despite recent data showing that consumer spending is still growing. Last week, the government estimated that the economy expanded at a healthy 3% annual rate in the April-June quarter.
Even as openings have fallen for the past two years, there are still roughly 1.1 job openings for every unemployed person, Wednesday’s report showed.
That reflects the economy’s continuing need for workers and marks a reversal from before the pandemic, when there were always more unemployed people than available jobs.
The July report on job openings is the first of several measures this week of the labor market’s health that the Federal Reserve will be watching closely.
If clear evidence emerges that hiring is faltering, the Fed might decide at its next meeting Sept. 17-18 to start cutting its benchmark interest rate by a relatively aggressive half-percentage point. If hiring remains mostly solid, however, a more typical quarter-point rate cut would be likelier.
In a speech at an annual economic symposium in Jackson Hole, Wyoming, Fed Chair Jerome Powell said that hiring has “cooled considerably” and that the Fed does not “seek or welcome further cooling” in the job market.
Economists saw those comments as evidence that the Fed may accelerate its rate cuts if it decides it is needed to offset a slowdown in hiring.



UK Banks Brace for Possible Tax Rise as Budget Nears

Barclays and HSBC buildings are seen in London, Britain October 20, 2020. REUTERS/Matthew Childs
Barclays and HSBC buildings are seen in London, Britain October 20, 2020. REUTERS/Matthew Childs
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UK Banks Brace for Possible Tax Rise as Budget Nears

Barclays and HSBC buildings are seen in London, Britain October 20, 2020. REUTERS/Matthew Childs
Barclays and HSBC buildings are seen in London, Britain October 20, 2020. REUTERS/Matthew Childs

UK-based banks are stepping up lobbying efforts against possible tax hikes in the government's inaugural Budget on October 30, amid mounting worries it may tap the cash-rich sector to boost Britain's finances, senior industry sources told Reuters.
Finance minister Rachel Reeves is due to meet senior representatives of the banking sector in the coming days, where bankers expect a rise in taxes on lenders' profits will be discussed, two of the sources said.
So far neither Prime Minister Keir Starmer nor Reeves has said banks will be required to pay higher taxes, but Starmer's recent reference to the burden falling on those with “broader shoulders” has fueled concerns a policy change might be imminent, three sources said.
The sources, who declined to be named because of the sensitivity of the matter, said they anticipate the Treasury will seek to hike taxes by increasing an existing surcharge on profits that lenders already pay.
This plan would be easier for the finance minister to achieve than cutting the amount of interest UK banks earn on reserves parked at the Bank of England, a measure which could distort the effects of its monetary policy, the sources said.
HSBC, Britain's largest bank, posted a 78% rise in 2023 pretax profit to $30.3 billion pounds in February and domestic peers including NatWest Group and Barclays have posted similarly bumper returns.
According to the sources, UK banks are already taxed more aggressively than many other international rivals, and increasing the sector's costs via taxes could have an impact on the cost and availability of credit, the sources said.
The existing UK bank levy was introduced in 2011 to curb a crisis-era culture of excessive risk and reckless growth across the industry in the wake of the global financial crisis.
Shares in UK banks dipped briefly last week after the Financial Times quoted an unnamed former government official making the case for a “sensibly crafted” levy on banks that have enjoyed bumper profits on the back of higher interest rates.