WASHINGTON — In February, employers scaled back job openings to 7.6 million, signaling a slowdown yet maintaining a robust labor market. The recent wave of workforce reductions, notably among federal employees, marked the highest since the COVID-19 pandemic’s economic impact began in 2020, partly reflecting the influence of Elon Musk’s labor force reduction strategies.
The Labor Department revealed a slight decrease in the number of job vacancies from a revised 7.8 million in January. This continues a downward trend from the previous year’s 8.4 million job openings. The peak of 12.1 million in March 2022 showed a highly active recovery period after the initial COVID-19 lockdowns subsided.
Layoffs increased to 1.8 million in February, compared to 1.7 million in January. Federal agencies dismissed 18,000 employees, marking the highest number since October 2020. Retailers, expressing caution about their 2025 forecasts, let go of 238,000 workers, the most considerable number since April 2020 during the pandemic recession’s depths.
The Job Openings and Labor Turnover Summary from the Labor Department also noted a slight decrease in the number of individuals voluntarily leaving their jobs, indicating reduced confidence in securing improved wages or working conditions elsewhere.
Despite these changes, the American job market remains resilient, though it has slowed from the rapid hiring phase between 2021 and 2023. Future employment prospects are uncertain amid actions by President Donald Trump, who is advancing trade conflicts, reducing federal employment, and vowing to deport numerous undocumented immigrants currently working in the U.S.
Such policies have begun affecting public sentiment regarding employment and the broader economy. The University of Michigan’s latest consumer sentiment survey, released in late March, reported a notable dip in Americans’ economic outlook, accompanied by heightened worries over inflation and job stability.
Economists are increasingly concerned that Trump’s impending broad tariffs on U.S. trade partners could cause price increases and impede economic expansion.
“The job market remains a stalwart of economic stability, albeit slowly weakening without indicating an imminent recession,” economist Robert Frick from Navy Federal Credit Union commented on the job openings report. “The crucial test will be how it withstands the impact of tariffs on consumer and business activities, a question that will take more time to resolve.”
Anticipation builds for the Labor Department’s upcoming March jobs report. According to FactSet’s survey of forecasters, expectations are for a modest gain of 125,000 jobs, a decrease from February’s 151,000 and the 2024 average of 168,000 monthly. The unemployment rate is projected to rise slightly to a still-manageable 4.2%.