Job openings in U.S. inch up to 9 million. Labor market still sturdy.

Many openings are never actually filled, but the trend in job postings gives clues on the health of the labor market and the broader economy.

Job openings have shrunk from a record 12 million in 2022, but they are higher compared to pre-pandemic days. And though hiring has slowed, many businesses continue to add workers.

Still, the Federal Reserve officials views a smaller number of openings as evidence that higher interest rates are slowing the economy and tempering inflation.

The number of people quitting jobs, meanwhile, fell again to 3.4 million and hit the lowest level in a few years.

Fewer people quitting jobs is also a sign of a softer labor market. Job quitters had climbed in late 2021 to a record 4.5 million before subsiding.

Key details: Most of the new job openings were in white-collar professional occupations. They also rose in manufacturing and health care.

New job listings decline in wholesale and transportation, as is often the case after the end of the holiday shopping season.

The number of job openings for each unemployed worker was unchanged at 1.4. The ratio is down from a peak of 2.0 in 2022 and almost back to a pre-pandemic norm of around 1.2 or so.

Fed officials had been watching the ratio closely as a gauge of labor-market strength.

The U.S. is forecast to add 185,000 new jobs in January. The jobs report comes out on Friday.

Big picture: The labor market has cooled off in the past year, but it’s by no means weak.

Layoffs are still near record lows, the unemployment rate is just 3.7% and the economy is adding close to 200,000 jobs a month.

The Fed would like to see the demand for labor soften a bit more, but with the economy perking up and interest rates likely to decline later in the year, it’s hard to see the jobs market losing much more momentum.

Market reaction: The Dow Jones industrial average
DJIA
and S&P 500
SPX
fell in Tuesday trades. Stocks remain near record highs, however.