US Job Openings Hit 7.5 Million, Outpacing Unemployment

The U.S. labor market showed signs of reacceleration in September as employers added vacancies at a faster pace than seen in months. The Labor Department reported on Tuesday that total job openings surged to 7.5 million, a notable increase from the revised figure of 7.19 million in August. This marks the highest level of openings since May and represents a recovery from the recent low of 6.9 million recorded in March.

The Job Openings and Labor Turnover Survey indicated that gross hiring rose while layoffs declined during the same period. Layoffs fell sharply to 1.64 million, the lowest number since March 2025. Conversely, the number of workers voluntarily leaving their jobs climbed to 3.37 million, the highest count in approximately 18 months and up from 3.04 million in the prior month. Economists generally view rising quits as a positive indicator, suggesting workers have the confidence or alternative offers to leave their current positions.

Job openings now outnumber the total number of unemployed individuals, a reversal from a year ago when job seekers outnumbered available positions. The increase in vacancies was most pronounced in professional and business services, a sector that includes engineering and accounting roles. Manufacturing, shipping firms, and state and local governments also increased their advertised need for workers. Heather Long, chief economist at Navy Federal Credit Union, described the trend as encouraging, noting that companies are slowly increasing hiring despite high fuel prices and ongoing inflation.

However, the data reflects a labor market with low turnover, where employed individuals enjoy high job security but unemployed individuals face difficulty finding work. Nicole Bachaud, a labor economist at ZipRecruiter, cautioned that high inflation and higher interest rates since summer make business operations more expensive. She stated that these factors likely continue to exert downward pressure on hiring until inflation cools significantly.

The government will release the October employment report on Friday. FactSet data indicates that employers are forecast to have added 65,000 positions last month, an improvement over the 29,000 jobs added in September. The unemployment rate is expected to remain at 4.2%. While 65,000 job gains would typically signal economic weakness, the current demographic shift involving the retirement of the baby boom generation and reduced immigration means the economy requires fewer new positions to maintain low unemployment levels.