The U.S. labor market showed little movement in July, continuing a pattern in which employers are reluctant to significantly expand their workforces but are also largely avoiding widespread layoffs.
New federal data released Tuesday showed 7.27 million job openings at the end of July, up modestly from a revised 7.18 million in June.
The increase was small enough that the Bureau of Labor Statistics characterized the number of available positions as essentially unchanged.
The job openings rate edged up to 4.4% from 4.3%.
July’s figures reinforce what has increasingly become known as a low-hire, low-fire labor market.
Businesses are still advertising millions of available positions, and unemployment remains relatively low, but companies are bringing new employees onto payrolls at a considerably slower pace than during the labor shortages that followed the COVID-19 pandemic.
At the same time, employers are not dismissing large numbers of workers.
That combination has created an unusually stagnant employment environment in which people who already have jobs often remain in them while people looking for new work can face a more difficult search.
Hiring actually weakened during July.
Employers brought approximately 5.05 million people onto payrolls during the month, down from roughly 5.33 million in June.
The national hiring rate declined from 3.4% to 3.2%.
Professional and business services accounted for a particularly large portion of that decrease.
Hiring in the sector dropped by approximately 188,000 during July.
The category includes a broad range of businesses such as accounting firms, consulting companies, temporary staffing agencies, legal services, technical businesses and other professional employers.
Only about 900,000 people were hired in professional and business services during July, compared with approximately 1.09 million in June.
That slowdown is another indication that employers are becoming more cautious about adding workers even when positions remain available.
Job openings themselves increased most noticeably in manufacturing.
Manufacturers had approximately 580,000 positions available in July, compared with about 501,000 one month earlier.
Durable-goods manufacturers accounted for most of the increase.
Openings in that category rose by roughly 76,000 to 429,000.
Durable goods include products intended to last for several years, such as machinery, automobiles, appliances and other equipment.
Manufacturing’s increase helped offset weaker demand for workers in several other areas.
Professional and business services still had more than 1.1 million openings, although that was down from approximately 1.2 million in June.
Health care and social assistance remained another major source of labor demand, with roughly 1.44 million openings.
Retail businesses had approximately 731,000 vacancies, while accommodation and food-service employers reported around 673,000.
But available jobs tell only part of the story.
Economists also closely watch how many workers are quitting because voluntary departures provide insight into how confident employees feel about finding something better.
About 3.06 million workers voluntarily left their jobs in July.
That was down from roughly 3.21 million in June.
The quits rate remained near 1.9%.
Workers generally become more willing to resign when they believe other jobs are plentiful, employers are competing for labor and switching companies could lead to better wages or working conditions.
During the unusually tight labor market that followed the pandemic, quits surged as employees frequently moved between companies and businesses competed aggressively for workers.
That environment has largely disappeared.
Today, many employees appear less willing to give up an existing paycheck without knowing another opportunity is secure.
The lower level of job switching also has implications for wages.
Changing employers has historically been one of the more effective ways for workers to receive significant pay increases.
When fewer people feel comfortable moving between companies, employers face less pressure to aggressively increase compensation to attract or retain workers.
While hiring and quitting remain subdued, layoffs are still remarkably restrained.
Employers reported approximately 1.67 million layoffs and discharges in July, down from about 1.79 million during June.
The layoff rate remained around 1%.
That is historically low and provides an important counterweight to concerns about weak hiring.
A slowing labor market can become significantly more damaging when companies begin eliminating existing jobs in large numbers.
So far, the national data do not show that kind of widespread retrenchment.
Finance and insurance businesses reduced layoffs by approximately 22,000 during July.
Manufacturing layoffs were also relatively low despite uncertainty surrounding trade, energy costs and broader economic conditions.
Companies appear to be cautious about both hiring and firing.
Many businesses spent the past several years struggling to find employees, particularly after the pandemic disrupted the labor supply.
Those experiences may have made employers more hesitant to dismiss workers they already have.
Businesses also continue to face uncertainty surrounding economic growth, tariffs, borrowing costs, geopolitical conflicts and inflation.
That can discourage executives from committing to large increases in payrolls.
But uncertainty can simultaneously encourage companies to retain current employees until the direction of the economy becomes clearer.
Total separations, which include quits, layoffs, dismissals, retirements and other departures, totaled approximately 5.07 million in July.
That was down from about 5.34 million in June.
The total separations rate declined to approximately 3.2%.
Other separations, including retirements, deaths, disability-related departures and transfers to other locations of the same company, were essentially unchanged at approximately 350,000.
The overall picture is therefore one of remarkably limited movement.
There are still more than seven million vacancies.
Roughly five million people are being hired every month.
Millions of workers continue leaving jobs.
But all of those figures are much less dynamic than they were during the exceptionally active labor market earlier in the decade.
One closely watched measurement compares the number of available jobs with the number of unemployed Americans.
That ratio is around 1.1 openings for every unemployed worker.
The figure is significantly lower than during the post-pandemic labor shortage, when there were nearly two available positions for each unemployed person.
But it also suggests the labor market has not swung dramatically in favor of employers.
There are still slightly more vacancies than unemployed people seeking work.
Economists generally view that relationship as evidence that the labor market is now much closer to balance.
That balance, however, can feel very different depending on whether someone already has a job.
For employees who are currently working, low layoffs provide considerable job security.
For people trying to find employment, weak hiring means the existence of millions of job postings does not necessarily translate into easy access to a new position.
Businesses may advertise openings but take longer to fill them, become more selective about candidates or postpone hiring decisions altogether.
The July JOLTS report also contained an important revision to the previous month’s data.
June job openings had initially been reported at approximately 7.36 million.
That figure was revised downward by 177,000 to approximately 7.18 million.
June hiring was revised slightly lower as well, while total separations were also reduced.
The revisions make July’s small increase in openings look somewhat stronger than it otherwise would have, but they do not fundamentally change the broader picture of a slow-moving job market.
The latest JOLTS data arrive after a disappointing July employment report.
The U.S. unexpectedly lost 23,000 payroll jobs during July.
Job gains for May and June were also revised substantially lower.
Despite the decline in payrolls, the unemployment rate slipped to 4.1%.
That decrease did not necessarily reflect a dramatic improvement in employment conditions because the labor force also shrank as some people stopped looking for work.
Job creation during 2026 has remained modest.
The economy has added an average of roughly 61,000 jobs per month so far this year, considerably below the rapid pace experienced during the pandemic recovery.
Still, that represents an improvement from extremely weak growth during portions of 2025.
The combination creates a complicated environment for the Federal Reserve.
The central bank has two major responsibilities: keeping inflation under control while supporting maximum sustainable employment.
If the labor market were collapsing, policymakers would have a strong reason to reduce interest rates to encourage hiring and economic activity.
July’s turnover numbers do not show that kind of collapse.
Layoffs remain low, vacancies remain above seven million and unemployment remains near 4%.
At the same time, the decline in hiring and worker mobility suggests the labor market is no longer running hot enough to create the kind of wage pressure policymakers worried about several years ago.
Inflation has nevertheless remained the Federal Reserve’s more pressing challenge.
Higher oil and energy costs associated with continuing conflict involving Iran have increased household expenses and renewed concern that inflation could remain above the Fed’s 2% target.
Financial markets have consequently increased expectations that policymakers could raise interest rates again at their September meeting.
A relatively stable labor market could make that decision easier.
If employers continue holding onto workers despite higher borrowing costs, Fed officials may conclude that another rate increase can be used to fight inflation without triggering a sudden surge in unemployment.
But policymakers will receive much more information before making that decision.
The government is scheduled to publish its broader August employment report Friday.
Economists will be watching payroll growth, unemployment, labor-force participation and wage increases for evidence that July’s weakness either continued or reversed.
Some forecasts expect employers to have added roughly 50,000 to 65,000 jobs in August.
The unemployment rate is expected by some economists to move modestly higher to approximately 4.2%.
A significantly stronger employment report could increase expectations for another interest-rate hike.
A weak report could create new concerns that the low-hire environment is beginning to turn into something more serious.
For now, however, July’s data show remarkably little evidence of either a hiring boom or a layoff wave.
Businesses still need workers, but they are not rushing to hire them.
Workers still have jobs, but they are increasingly reluctant to leave.
Employers are confronting economic uncertainty, but most are choosing to hold onto existing staff rather than make substantial cuts.
That has left the American labor market in a kind of holding pattern.
It remains stable enough to avoid the hallmarks of a recession but slow enough that job seekers may have difficulty feeling the strength suggested by a 4.1% unemployment rate.
The next question is how long that balance can last.
If economic growth remains resilient and inflation eventually cools, hiring could strengthen again without requiring a major rise in unemployment.
If companies become more pessimistic, however, today’s reluctance to hire could eventually be followed by an increase in layoffs.
July offered little indication that either shift has begun.
Instead, the labor market spent another month largely standing still.