New federal data indicates a marked cooling in the U.S. labor market at the close of 2025, with the number of available positions falling to its lowest point in over five years.
According to the latest Job Openings and Labor Turnover Survey (JOLTS), job openings declined by 386,000 in December, settling at 6.54 million. This represents the smallest total since the autumn of 2020. Figures for November were also adjusted downward significantly, from an initial estimate of 7.15 million to 6.93 million.
While hiring saw a modest increase of 172,000 jobs in December, the overall pace remains subdued. The data arrives alongside a separate report showing a recent, sharper-than-anticipated rise in weekly applications for unemployment benefits. For the week ending January 31, initial claims rose by 22,000 to a seasonally adjusted 231,000.
Analysts note that this jump in claims is likely temporary, influenced heavily by severe winter weather that disrupted work across several states, including Pennsylvania, New York, and Ohio, towards the end of January. Furthermore, statistical volatility common around the year-end holidays is beginning to normalize in the data.
Economists emphasize that despite these fluctuations, there are no broad indicators of widespread layoffs typically associated with an economic downturn. The labor market appears to be stabilizing into a pattern characterized by modest hiring activity but also limited dismissals.
The most comprehensive employment report for January has been delayed due to a federal government funding lapse and is still pending. The forthcoming data will provide a clearer picture of whether the softening in job openings translates into a shift in the overall unemployment rate.
