A record 4.4 million Americans quit their jobs in September, as job openings remained near record levels according to federal data, a sign of how imbalances in the labor market continue to complicate the economic recovery 20 months into the pandemic.
Those numbers are up from August, when 4.3 million people who quit their jobs in August — about 2.9% of the workforce. September’s quit numbers constituted 3% of the workforce.
The statistics reflect the changes that continue to wrench the labor market after the pandemic upended the course of business and life across the country in 2020.
Americans are quitting their jobs for a number of reasons.
In September, when the delta variant of the coronavirus was nearing its peak, child care and other pressures forced many employees to rethink their daily routine. Many other workers, meanwhile, were lured to other jobs because of better pay and benefits elsewhere as employers became desperate to fill openings.
The August data, for example, showed that workers in more rural areas quit at a higher rate in part because they had more leverage to demand better pay.
In September, the number of quits increased in arts, entertainment, and recreation (+56,000); a category labeled “other services” (+47,000); and state and local government education (+30,000). In general, industries with the highest percentages of workers quitting include trade, transportation, and utilities, particularly retail, professional and business services, and leisure and hospitality industries like arts and entertainment, and hotels and restaurants. A whopping 6.6% of workers in accommodation and food services quit their job in the month.
The South, the West and Midwest have the highest numbers of workers quitting their jobs, at 3.3, 3.1 and 3.0%, while only 2.2% of workers in the Northeast are quitting jobs.
The country has regained the vast majority of jobs lost in the earliest months of the pandemic, but still has more than four million jobs less than it did in February 2020. Economists have been looking to the return to full employment as an important milestone, but labor shortages, surging caseloads from the Delta variant, supply chain issues and other wrinkles have emerged to complicate that recovery.
Businesses and industry groups have complained vociferously about trouble finding available workers since the country’s wide reopening in the spring, as they have sought to hire up. Efforts to curtail unemployment benefits to address the problem, have thus far shown little success of prompting large numbers of people back into the labor market.
Economists surmise that phenomena is a result of a complicated mix of trends. Child and family care, and schooling unpredictability continue to fuel the reluctance of some parents to get back into the labor force. Public health concerns remain an issue for in-person work, with the virus caseloads remaining stubborn despite declining significantly from their mid-September peak.
Many workers have made the calculation that their old jobs — low-paying work in industries like restaurants, which have really struggled to fill holes — are no longer desirable, even as companies dangle raises and bonuses to lure workers back to the workplace. Some older workers have taken early retirements, part of a portrait of a labor force that has shrunk, by percentage of the U.S. population during the pandemic.
And some economists’ question whether there are other factors that have reshaped the traditional dynamics of the labor force after 750,000 people have died.
Even in this climate, there are workers who say they can’t find suitable work, raising questions about supply and demand mismatches in the labor market as workers needs have changed.
According to the jobs site ZipRecruiter, some 62% of jobs seekers on the site report that they are looking to change the type of job they had, according to a September study; 55% said they are now trying to get a job where they can work from home.
Of those who were seeking the ability to work from home, 85% said either workplace safety concerns (50%) or child care/family care needs (35%) were driving their decisions — data that indicates how many people are attempting to switch industries in the hopes of being able to work from home.
But companies often have very rigid criteria for the types of resumes they’ll consider for jobs.
All the churn has left workers with more leverage than before the pandemic, which has resulted in significant wage increases as well: average hourly earnings are up more than 5% for the year. Strikes by unionized workers have ticked up as well.
But inflation from the rising prices of goods are wiping out those wage gains, at least so far. Prices rose 6.2% in October for the year — the largest annual increase in 30 years, raising the specter that inflation could complicate political decisions in Washington in the coming months. When adjusted for the costs of rising prices, earnings are down 1.1% on the year.
“I would expect over the next year the price inflation to relent a bit, and most of the wage growth to stay — and so I think they’re going to come out ahead,” said Josh Bivens, the director of research at the left-leaning Economic Policy Institute. “But yeah, this inflationary spike is definitely a bit into the growth of paychecks.”
Appalachian Regional Healthcare signage seeking job applications during a job fair at a community center in Beattyville, Ky., on July 28, 2021. (Jon Cherry/Bloomberg)
