Job openings slip while U.S. employers keep layoffs low

Job openings fell to 7.36 million in June as the U.S. labor market absorbed higher energy prices and remained steady before the July jobs report.

The Labor Department said Tuesday that advertised vacancies declined from 7.54 million in May, broadly matching forecasters’ expectations. Layoffs were little changed at 1.8 million, while quits rose slightly, a signal that workers were not retreating from the labor market despite the shock from fighting in Iran and the closure of the Strait of Hormuz.

Vacancies cooled, layoffs held

The June report showed employers were still cautious about expanding payrolls, but not moving aggressively to cut staff. Gross hiring rose slightly to 5.3 million, well below the post-lockdown jobs boom, when monthly hiring often exceeded 6 million.

The sector split pointed to uneven demand rather than a broad pullback. Openings increased by 97,000 at warehouse, transportation and utility employers and by 39,000 at federal agencies, while wholesalers and nondurable-goods manufacturers reported fewer vacancies.

Hormuz shock meets slow hiring

The labor market entered the summer with two opposing forces at work: a recovery from last year’s hiring slump and a new energy shock tied to the Iran conflict. Before the war, roughly 15 million barrels of Persian Gulf oil moved each day through the Strait of Hormuz, a route bordering Iran that has become a direct risk for shipping.

Higher energy costs matter for employers because they feed into transport, production and household budgets. For sectors such as warehousing, utilities and transportation, continued demand for workers suggests companies have not yet treated the oil shock as a reason to freeze staffing plans.

The June numbers also sit against a softer hiring baseline than the U.S. economy had after pandemic restrictions eased. Companies, government agencies and nonprofits have added an average of 92,000 jobs a month so far this year, up from fewer than 10,000 a month last year, when high interest rates and uncertainty around President Trump’s economic policies weighed on decisions.

July payrolls will test momentum

The next test arrives Friday, when the Labor Department releases the July employment report. A survey by FactSet showed forecasters expecting 100,000 jobs to be added, up from 57,000 in June, with the unemployment rate holding at 4.2%.

If July payrolls meet those expectations and layoffs stay near June’s level, the labor market would look slow but stable: a setup that could cushion consumer demand, help transport-heavy employers manage the energy shock and limit damage across service industries. If oil disruptions deepen or hiring weakens again, employers could respond by leaving openings unfilled rather than cutting jobs first, which would show up as lower vacancies before a sharper rise in layoffs.

For the wider economy, the open question is whether energy prices remain a temporary cost shock or become a lasting drag on margins and household spending. For companies, the mechanism is straightforward: higher fuel and input costs can narrow the budget for hiring, especially in manufacturing, wholesale trade and logistics, while a still-low unemployment rate can keep wage pressure from easing quickly.