KPMG Analysis: January Job Openings Rise, Layoffs Fall in Latest JOLTS Data

Job openings rose by 396,000 to 6.946 million in January 2026, blowing past the 6.70 million economists had forecast, while the layoff rate fell to its lowest three-month average in about 18 months. KPMG's analysis of the Bureau of Labor Statistics JOLTS report, posted March 13, characterized the picture as a labor market still defined by low churn rather than meaningful acceleration.

The private sector drove most of the January rebound. KPMG reported that private-sector openings rose 370,000, reversing sharp December declines in retail, finance and insurance, and healthcare and social assistance. Public-sector openings edged higher as well, pushed up by state and local government. The job openings rate climbed to 4.2% from 4.0% in December.

Hiring told a more cautious story. The hiring rate held flat at 3.3% in January, a rate that, aside from a brief uptick last spring, has not meaningfully moved in over a year. Professional and business services recorded the largest single-sector increase in January hiring, but that sector also saw openings fall below 1,000 for the first time since April 2020, with KPMG attributing part of the pressure to declining employment in the administrative and waste services subindustry throughout 2025. KPMG also flagged that firms across professional and business services are reorganizing workforces around generative AI, a structural shift that is reshaping demand rather than simply suppressing it.

The layoff rate fell to 1.0% from 1.1%, and on a three-month moving average basis, that 1.0% rate is the lowest in roughly a year and a half. "Despite endless news stories about large layoffs, they remain at historically low levels," the Reuters analysis noted. "That is little solace for those who have lost their jobs and face difficulty getting work in the low hire environment." Quits rose alongside hires in January, suggesting workers retained some confidence in voluntarily leaving positions even as overall labor market velocity stayed muted.

Friday's release also included the annual JOLTS revision, which nudged the 2025 picture slightly softer. Average job openings for 2025 were revised down to 7.1 million from 7.3 million, and the hiring rate for 2025 was revised to 3.3% from 3.4%. Layoffs and quits for the full year were described as flat in the revision. KPMG's read: "Slightly lower openings and hiring do not materially change our understanding of the 2025 labor market: low churn and relatively steady throughout the year."

The revision was concentrated at the small end of the employer spectrum. KPMG noted that the 2025 downward revision to openings fell mainly on firms with 1 to 49 employees, which "have struggled more from policy shocks and uncertainty." ADP payroll data cited by KPMG showed a recent uptick in small-business job gains, however, suggesting those firms entered 2026 with some forward momentum.

The Fed-tracked ratio of job openings to unemployed job seekers ticked up to 0.94 from 0.87 in January, though KPMG characterized it as roughly flat at 0.9 after rounding. Real-time data from Indeed Hiring Lab showed advertised job postings holding flat since late November, having reversed a September and October downturn, reinforcing KPMG's conclusion that labor demand has stabilized rather than softened further.

The January numbers represent tentative improvement, but as the Reuters commentary on the data cautioned, monthly JOLTS figures are noisy. Whether the January rebound in openings and the continued decline in layoffs prove durable will become clearer in the February release.