Christopher Rugaber, author of AP Economics
WASHINGTON (AP) – U.S. employers advertised fewer jobs in May as the economy weakened, even as overall labor demand remained strong.
Employers posted 11.3 million job opportunities in late May, the Department of Labor said Wednesday, down from about 11.7 million in April. Job opportunities reached 11.9 million in March, the highest level on record in more than 20 years. There are about two job opportunities for every unemployed person, a sharp contrast from the historical pattern: before the epidemic, there were always more unemployed people than there were jobs available.
The figures reflect the unusual nature of the post-epidemic economy: inflation is hitting household budgets, forcing consumers to turn to spending and growth is weakening. Yet companies are still scrambling to add staff. Demand for travel- and entertainment-related services has been particularly strong.
Economists are closely monitoring job opening figures for signs that the labor market is cooling, which could bring down inflation. As companies post more available positions, they are raising salaries and offering more benefits to attract and retain employees. High labor costs, as a result, have contributed to price increases, with inflation now at a 40-year high.
The Federal Reserve has noted nearly record-high job opportunities as evidence that the economy has become overheated, and is rapidly raising short-term interest rates by controlling consumer and business spending to cool. Fed Chair Jerome Powell hopes that weaker spending will reduce labor demand, create fewer jobs and increase wages, and reduce inflation.
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