US: Labor market continues to incrementally cool – Wells Fargo

Data released on Tuesday showed the number of job openings decreased to 9.59 million in March. Analysts at Wells Fargo point out that although still high, this was the lowest level since April 2021. 

Key quotes:

“The Job Openings and Labor Turnover Survey (JOLTS) for March offered additional evidence that supply and demand in the labor market are coming into better balance.”

"The quit rate edged lower and the layoffs and discharges rate ticked higher, trends that are consistent with a labor market that continues to incrementally cool.”

“In an absolute sense, the labor market remains tight with openings and quits still above pre-pandemic levels and involuntary separations just getting back to what prevailed in 2018-2019. But a clear trend is emerging, and we expect labor demand to keep receding in the months to come.”

“We look for another step down in the pace of job growth in Friday's employment report, with more weakness to come later this year and into 2024.”