Job Openings Are Rising While U.S. Workers Continue to Quit in Droves
Feb 01, 2022
Job opportunities grew marginally in December, but the number of Americans leaving the labor market remained higher despite a decline from historic highs.
According to the Labor Department's Job Openings and Labor Turnover Survey, there were 10.9 million empty jobs in December, up from 10.6 million in November. The rate of job opportunities remained stable at 6.8 percent.
Based on FactSet's poll of economists, about 10.3 million job opportunities were anticipated in November.
"The job market is rather robust in this region," said Scott Brown, chief economist at Raymond James.
Accommodation and food service, information, non-durable products manufacturing, and state and local government education all had significant increases in job opportunities. Jobs in banking and insurance, as well as wholesale commerce, have fallen.
Hires fell to 6.3 million, a 333,000 reduction from November's 6.7 million, reducing the hiring rate to 4.2 percent.
"Keep in mind that these are December data. There is a lot of seasonality," Brown explained. He expects economists will have a more clear view of the data in the spring when seasonal effects begin to fade.
The number of Americans quitting their employment fell to 4.3 million in December, down from a series high of 4.5 million in November. The quits rate, a proxy for workers' inclination or capacity to leave jobs, remained stable at 2.9 percent.
The quits rate increased to 3% last month, as workers continued to quit at record rates in a tight job market. In health care and social support, housing and food services, and construction, quits declined. They expanded in the manufacture of non-durable items.
"Because wages are not keeping up with inflation, the only option for the majority of employees to increase their earnings is to locate a new company or have one foot out the door," Brown explained.
Brown said that participation remains low since some people who left the labor field during the crisis in 2020 have yet to return, while others have opted to retire early.
The layoff rate, meanwhile, fell to a series low of 0.8 percent, with 1.2 million layoffs, as firms resisted terminating workers due to the tight labor market.
Even before the epidemic, some businesses were having difficulty hiring and sought methods to attract new staff through increased salary, signing bonuses, or other advantages, Brown explained. These incentives have expanded significantly during the previous two years, he continued.