If the Federal Reserve is going to get inflation under control, which is, of course, what it’s trying to do by raising interest rates, the job market is going to have to cool down. That’s not just a guess, that’s a paraphrasing of Jay Powell. And according to Tuesday’s Job Openings and Labor Turnover Survey from the Bureau of Labor Statistics, that seems to be happening.

Between July and August, the number of job openings in this economy fell by about 10%, which is more than a lot of observers were expecting.

The job openings part of the report was pretty significant, according to Elise Gould, with the Economic Policy Institute. 

“It dropped from about 11.2 million to 10.1 million,” Gould said. “That kind of 10% drop, it’s very large in historical perspective.”

Until August, the number of job openings had stayed above 11 million every month this year, said Ryan Wang, a U.S. economist at HSBC.

The loss of a million plus job openings?

“That could be a sign that shows that that imbalance between labor supply and labor demand may be diminishing,” Wang said. “And that’s what [Federal Open Market Committee] policymakers are hoping to accomplish with tighter monetary policy.”

Retail is one of the most visible parts of the economy where job openings shrank — by around 143,000 sectorwide. That’s down more than 30% since a year ago.

Wang said there’s a reason for that.

“Consumer demand for goods really boomed in 2021,” he said. “And this year, we’ve seen some signs that consumer demand for goods is starting to level off or even declining a bit.”

So retailers aren’t hiring as aggressively.

There were also fewer job openings in health care and social assistance in August, said Kathryn Zickuhr, senior labor policy analyst, at the Washington Center for Equitable Growth.

“It’s still above pre-pandemic levels overall, but the growth that we were seeing last year especially has leveled off,” she said.

The upshot: The labor market’s cooling, but far from freezing.