The US Job Openings and Labor Turnover Survey (JOLTs) Job Quits for September 2025 registered 3.09 million, down from 3.21 million in August and below the consensus estimate of 3.18 million. This marks a 3.60% month-over-month decline and a modest decrease compared to the 12-month average of approximately 3.18 million quits. The data signals a slight easing in worker confidence or mobility amid evolving economic conditions.

Drivers this month

• Labor market normalization post-pandemic with fewer voluntary separations.
• Rising borrowing costs dampening hiring enthusiasm and job switching.
• Sectoral shifts, notably in tech and retail, influencing quits rates.

Policy pulse

The quits rate remains above pre-pandemic levels but shows signs of plateauing. This aligns with Federal Reserve efforts to moderate inflation without triggering a sharp labor market contraction. The quits figure sits near the Fed’s comfort zone, suggesting labor market tightness is easing but not collapsing.

Market lens

Initial market reaction saw a mild dip in US Treasury yields and a slight strengthening of the USD, reflecting cautious optimism. The 2-year Treasury yield fell by 3 basis points, while the DXY index rose 0.15% within the first hour post-release.

Job quits are a leading indicator of labor market health, reflecting worker confidence and economic dynamism. The current 3.09 million quits figure compares to a peak of 3.33 million in April 2025 and a low of 3.06 million in January 2025, illustrating moderate volatility within a generally strong labor market.

Historical comparisons

• September 2025 quits (3.09M) are 7.10% lower than the April 2025 peak (3.33M).
• Compared to October 2024 (3.07M), quits have risen marginally by 0.65% over 11 months.
• Year-over-year quits remain elevated versus the 2019 pre-pandemic average of roughly 2.50 million.

Monetary policy & financial conditions

The Federal Reserve’s ongoing rate hikes, now totaling 525 basis points since early 2024, have tightened financial conditions. Higher interest rates have increased borrowing costs, slowing hiring and reducing quits as workers weigh job security more heavily. The labor market’s resilience despite these headwinds is notable but may be nearing a turning point.

Fiscal policy & government budget

Fiscal stimulus has waned since 2023, with government spending growth slowing. Budget deficits remain elevated but are not expanding aggressively, limiting additional fiscal support for labor markets. This fiscal restraint complements monetary tightening, contributing to the moderation in quits.

Sectoral quits data (from Sigmanomics database) indicate that technology and retail sectors saw the largest declines in quits, while healthcare and professional services remained relatively stable. This uneven pattern suggests workers in more volatile industries are exercising greater caution.

Market lens

Immediate reaction: EUR/USD dipped 0.20% as risk sentiment softened slightly post-release. US equity futures declined modestly, reflecting investor caution about labor market cooling.

Looking ahead, the quits data points to a labor market that is still tight but losing some momentum. This has important implications for inflation, wage growth, and monetary policy.

Scenario analysis

• Bullish (30% probability): Quits stabilize or rise modestly as economic growth resumes, supporting wage gains and consumer spending.
• Base (50% probability): Quits remain near current levels, reflecting a balanced labor market with moderate job switching and steady wage growth.
• Bearish (20% probability): Quits decline further due to recession fears or tighter credit, leading to slower wage growth and weaker consumer demand.

Structural & long-run trends

Long-term trends such as demographic shifts, remote work adoption, and automation continue to reshape quits behavior. Younger workers historically have higher quit rates, but aging demographics may temper this trend. Additionally, evolving job preferences and gig economy growth could sustain quits at elevated levels compared to pre-pandemic norms.

The September 2025 JOLTs Job Quits report confirms a labor market in transition. While still robust by historical standards, the decline in quits signals caution among workers amid tighter monetary policy and economic uncertainties. Policymakers will monitor these trends closely as they balance inflation control with labor market health.

Investors should watch for further quits data and wage growth signals to gauge the risk of a sharper slowdown or recession. The interplay between labor market dynamics and financial conditions will remain a key driver of US economic performance in the coming quarters.

Insight: JOLTs Job Quits vs. SPY Since 2020

Since 2020, the SPY ETF has shown a positive correlation with JOLTs Job Quits data. Periods of rising quits have coincided with equity market rallies, reflecting investor confidence in economic growth and labor market fluidity. Conversely, sharp drops in quits often precede market pullbacks, signaling risk aversion. This relationship underscores the quits metric’s value as a forward-looking economic indicator.

FAQs

What is the significance of the JOLTs Job Quits report?

The JOLTs Job Quits report measures voluntary separations, indicating worker confidence and labor market health. It helps forecast wage trends and economic momentum.

How does the quits rate affect monetary policy?

High quits rates suggest a tight labor market, potentially fueling wage inflation. The Federal Reserve monitors quits to gauge inflation risks and adjust interest rates accordingly.

What does a decline in quits imply for the economy?

A decline may signal reduced worker confidence or slower economic growth, possibly leading to softer wage gains and consumer spending.

Takeaway: The September 2025 JOLTs Job Quits data points to a labor market cooling from earlier peaks but still resilient, suggesting a cautious yet stable economic outlook amid tightening financial conditions.