Things could be better, but they could also be worse.

Even before the world seemingly turned upside down in March following the US-Israeli war with Iran, the labor market was already “stuck in neutral,” as Laura Ullrich, director of economic research in North America at Indeed’s Hiring Lab described it. Job demand continued to fall in February, while attrition largely remained the same, according to the newest Job Openings and Labor Turnover Survey from the Bureau of Labor Statistics, published on Tuesday.

Diving into the data. Job openings fell to 6.9 million in February, from 7.2 million in January. Similarly, total hires fell by around half a million in that same period, to 4.8 million in February. The total hires rate for February decreased to 3.1%, which hasn’t been that low since April 2020.

Total quits declined slightly to 3.1 million in February, from around 3.1 million in January, while layoffs and discharges were unchanged at 1.7 million.

Overall, experts say the decline in job demand combined with decreased attrition shows that employers are hitting pause on expanding their businesses, and as a result, scaling back on hiring. Much of that is driven by uncertainty.

“As long-term indicators of labor demand, continued declines in job openings and hiring affirm that employers remain cautious about expanding headcount based on what they know, such as rising costs of business, and what they don’t know, especially due to policy uncertainties as well as geopolitical tensions,” Noah Yosif, chief economist at the American Staffing Association, said via email.

Tuesday’s JOLTS data was from February, before the US instigated joint military operations against Iran. As employers anticipate March’s jobs data, due on Friday, they should expect to see that holding pattern continue.

“I think it’ll deepen the pause behavior. It’s not going to immediately trigger any more layoffs, it’s going to just continue, because what it does is it just increases the uncertainty,” Raj Namboothiry, SVP at Manpower US, told HR Brew. Though disruptions to oil supplies and supply chain routes caused by the conflict will have a negative impact on sectors including manufacturing, logistics, and retail, he added.

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