“It seems clear that the labor market is cooling, and if we are correct about the pending benchmark revisions, the extent to which the labor market has cooled will take many by surprise,” said Richard Moody, chief economist at Regions Financial Corp.

The underemployment rate, a broader measure of labor-market slack than the headline unemployment rate, is at its highest level in almost a year as more Americans report working part-time for economic reasons. That number rose in June by the most since the immediate onset of the pandemic.

While some employers continue to struggle to attract and retain workers — which has helped keep wage growth elevated — higher interest rates and a gloomy outlook may be starting to weigh on labor demand.

Eoin Treacy's view

As I discussed in the audio/video last night, employment data is unreliable. How it is gathered, and how it reflects reality on the ground is not especially accurate. More importantly employment data is a lagging indicator.

Conditions need to deteriorate before they are reflected in corporate hiring decisions. The job openings report was designed in the hope of creating a leading indicator. The facts on the ground are companies leave job advertisements open even if they have no intention of hiring immediately.