Job openings decline in February as employers hit pause on hiring

Things could be better, but they could also be worse.

Even before the world seemingly turned upside down in March following the US-Israeli war with Iran, the labor market was already “stuck in neutral,” as Laura Ullrich, director of economic research in North America at Indeed’s Hiring Lab described it. Job demand continued to fall in February, while attrition largely remained the same, according to the newest Job Openings and Labor Turnover Survey from the Bureau of Labor Statistics, published on Tuesday.

Diving into the data. Job openings fell to 6.9 million in February, from 7.2 million in January. Similarly, total hires fell by around half a million in that same period, to 4.8 million in February. The total hires rate for February decreased to 3.1%, which hasn’t been that low since April 2020.

Total quits declined slightly to 3.1 million in February, from around 3.1 million in January, while layoffs and discharges were unchanged at 1.7 million.

Overall, experts say the decline in job demand combined with decreased attrition shows that employers are hitting pause on expanding their businesses, and as a result, scaling back on hiring. Much of that is driven by uncertainty.

“As long-term indicators of labor demand, continued declines in job openings and hiring affirm that employers remain cautious about expanding headcount based on what they know, such as rising costs of business, and what they don’t know, especially due to policy uncertainties as well as geopolitical tensions,” Noah Yosif, chief economist at the American Staffing Association, said via email.

Tuesday’s JOLTS data was from February, before the US instigated joint military operations against Iran. As employers anticipate March’s jobs data, due on Friday, they should expect to see that holding pattern continue.

“I think it’ll deepen the pause behavior. It’s not going to immediately trigger any more layoffs, it’s going to just continue, because what it does is it just increases the uncertainty,” Raj Namboothiry, SVP at Manpower US, told HR Brew. Though disruptions to oil supplies and supply chain routes caused by the conflict will have a negative impact on sectors including manufacturing, logistics, and retail, he added.

Zoom out. Employers are in a very different labor market than four years ago, at the height of the Great Resignation, when top talent was difficult to recruit. A recent SHRM analysis of job postings recorded by labor market analytics firm Lightcast found that job demand fell 30% on average between 2022 and 2025.

“These labor shortages have gone down, partly because of reduction in demand, partly because unemployment has steadily risen over time,” Justin Ladner, SHRM’s senior labor economist, said during a press call last week. “So we basically have supply going up, demand falling.”

And yet, despite an uptick in available talent, hiring has become even trickier for talent acquisition teams. Roles are taking longer to fill, as companies strive to ensure a perfect fit.

“HR leaders should realize that this is not a hiring market. It’s a decision market. So candidates are available, but it is not about hiring fast,” Namboothiry said. At the same time, he added, TA teams are under pressure to speed up that decision making process.“What will be important for HR leaders would be still to accelerate that decision velocity, they need to drive decision making faster.”

HR leaders and TA professionals should be working with hiring managers to better understand the specific qualifications they’re looking for in open roles, and how they can be recruited in today’s labor market, Namboothiry said. They also should consider leveraging alternative kinds of employment, such as part-time work, temp or staffing agencies, and gig work, he added.

“It’s not just hiring. It is a shift in strategy that requires planning,” and understanding how to help the organization drive optimization and productivity amid cost constraints, Namboothiry said. “Those would be critical considerations for the HR leaders right now.”