WASHINGTON (Reuters) - U.S. job openings increased in May after posting outsized declines in the prior two months, but layoffs picked up amid slowing economic activity.

Job openings, a measure of labor demand, rose 221,000 to 8.140 million on the last day of May, the Labor Department's Bureau of Labor Statistics said in its Job Openings and Labor Turnover Survey, or JOLTS report, on Tuesday.

Data for April was revised lower to show 7.919 million unfilled positions instead of the previously reported 8.059 million. Economists polled by Reuters had forecast 7.910 million job openings in May. Unfilled positions peaked at a record 12.182 million in March 2022.

Layoffs increased 112,000 to 1.654 million in May. A gradually rebalancing labor market and subsiding inflation are drawing the Federal Reserve closer to beginning its easing cycle, with financial markets still eyeing the first interest rate cut in September, despite policymakers recently suggesting otherwise.

The U.S. central bank has maintained its benchmark overnight interest rate in the current 5.25%-5.50% range since last July. The Fed has hiked its policy rate by 525 basis points since 2022 to stamp out inflation.