The red-hot US labour market cooled somewhat in March, US government data showed on May 1.

Employers had 8.5 million unfilled job openings on the last day of March, the fewest since early 2021, according to data released by the US Labour Department. They also filled the fewest jobs in nearly four years, suggesting that employers’ seemingly insatiable demand for workers might finally be abating.

A slowing US labour market would be welcome news for policymakers at the US Federal Reserve, who concluded a two-day meeting on May 1 amid signs that inflation is proving difficult to stamp out. Fed officials have said that they see falling job openings as a sign that supply and demand are coming into better balance.

For US workers, however, that rebalancing could mean a loss of the bargaining power that has brought them strong wage gains in recent years. The number of workers voluntarily quitting their jobs fell to 3.3 million, the lowest level in more than three years and a far cry from the more than four million a month who were leaving their jobs at the peak of the “Great Resignation” in 2022.

“This continued moderation is largely positive for the market and the economy overall, and is mostly sustainable for the time being,” Mr Nick Bunker, economic research director for the Indeed Hiring Lab, wrote in a note on May 1. But, he added, “if job openings continue to decline for much longer, hiring of unemployed workers will eventually retreat enough to drive unemployment up”.

There is little sign of that so far, however. Despite high-profile job cuts at a few large companies, layoffs remained low overall and fell in March. And while job opening numbers have fallen, there are still 1.3 available positions for every unemployed worker.

Data released by the US Labour Department on April 30 showed that wage growth picked up in the first three months of the year, suggesting workers retain some leverage.

The data released on May 1 came from the US Labour Department’s monthly survey of job openings and labour turnover. Economists will get a more timely snapshot of the labour market on May 3, when the US government releases its monthly jobs report.

Forecasters expect that data to show that employers added about 240,000 jobs in April and that the unemployment rate remained below 4 per cent for the 27th consecutive month. NYTIMES