In July, job vacancies in the United States fell to a 10-month low, and companies are becoming more cautious in their hiring. Labor demand continues to slow down.

The US labor market shows further signs of cooling down. The latest data released by the Bureau of Labor Statistics (BLS) on Wednesday revealed that job vacancies in the US fell to 7.18 million in July, hitting a new low in almost 10 months. This result was below the median expectation of 7.38 million from economists surveyed by foreign media, indicating that businesses are more cautious in their hiring practices, reflecting a gradual weakening of labor demand amidst increased policy uncertainty. In terms of industry distribution, healthcare, retail trade, and leisure and hospitality were the main sources of the decline in job vacancies in July. Among them, job vacancies in the healthcare sector, which has been a key driver of employment growth this year, dropped to the lowest level since 2021. Neil Dutta, Chief Economist at Renaissance Macro Research, pointed out, "The decline in job vacancies is mainly concentrated in healthcare and social assistance, as well as state and local government sectors. These industries usually do not fluctuate with economic cycles and are key areas supporting employment growth in recent times. If demand in these 'non-cyclical' sectors weakens, overall employment growth will face significant pressure." As a result, US Treasury bond yields declined after the data was released, while the S&P 500 index maintained its upward trend. The decline in job vacancies indicates that businesses are being more cautious in their hiring decisions. Stanley, Chief Economist at Santander US Capital Markets, stated, "Businesses are currently in a wait-and-see mode, with many planned hirings being put on hold, mainly waiting for clarity on policies, especially on trade tariffs." Recently, trade policies pushed by US President Trump have increased market uncertainty, prompting businesses to delay expansion plans. At the same time, the pace of hiring in the US has slowed down, and the time it takes for unemployed individuals to find new jobs has increased. Data shows a slight increase in layoffs, reaching the highest level since September of last year, with significant job cuts in the construction industry. However, overall hiring in July slightly rebounded. A key indicator closely monitored by the Federal Reserve, the ratio of job vacancies to unemployed persons, remained at 1:1 in July, continuing to hover around the lowest level since 2021. During the peak period in 2022, this ratio reached 2:1. This indicates a trend towards balance in labor supply and demand, making businesses more selective in their hiring. Additionally, the "quit rate," which measures employees' willingness to voluntarily leave their jobs, remained unchanged at 2% in July. Generally, a higher quit rate reflects a healthy labor market, with employees having more confidence in finding better opportunities. Federal Reserve officials are closely monitoring signs of weakness in the labor market. Chairman Powell previously stated last month that the "downside risks to employment are rising." It is widely expected that the Fed will announce a 25 basis point rate cut at the policy meeting on September 16-17 to address the pressures of a slowing labor market and economic growth. Economist Stuart Paul stated, "Fed policymakers have noticed that the labor market is no longer the main source of inflationary pressures. The data in July will reinforce this assessment. With a slowdown in hiring, both labor supply and demand are decreasing, with demand potentially declining faster." The latest data from the Atlanta Fed shows that in July, the wage growth of US employees staying in their current position for six consecutive months exceeded that of job changers, setting the longest record since the end of the 2008 economic recession. The three-month average shows that in July, the annual salary growth of employees staying in their current position was 4.1%, higher than the 4% increase for job changers. Typically, job changers' wage growth should be higher than those staying in their current position, and this "reversal" highlights a significant slowdown in labor demand in recent months. Stanley pointed out, "This phenomenon suggests that businesses are reducing aggressive talent-poaching behaviors, opting to retain existing employees rather than offering high salaries to attract new employees. This trend is completely different from the economic situation just after the end of the 2007-2009 financial crisis."