U.S. quits hit record high in August; hiring falls
WASHINGTON (Reuters) – The number of Americans voluntarily quitting their jobs surged to a record high in August, while hiring fell by the most in eight months, underscoring the difficulties that businesses are confronting as they try to fill millions of vacancies.
The Labor Department’s monthly Job Openings and Labor Turnover Survey, or JOLTS report, on Tuesday followed on the heels of news last Friday that the economy created the fewest jobs in nine months in September. The JOLTS report, which also showed more than 10 million vacancies in the economy, was another reflection of an economy that is battling shortages, which are boosting inflation and curbing growth.
“There are help-wanted posters in every shop window on Main Street, and the lack of workers is exacerbating the supply disruptions throughout the nation that is lighting a match to the fire of inflation,” said Christopher Rupkey, chief economist at FWDBONDS in New York.
Quits increased by about 242,000 in August, lifting the total to a record 4.3 million. There were 157,000 people who quit in the accommodation and food services industry while 26,000 left in the wholesale trade business. State and local government education saw 25,000 departures.
Graphic: Are you being served?,
People are most likely leaving their jobs for fear of contracting COVID-19. The number of quits increased in the South and Midwest regions, which have borne the brunt of the summer wave of coronavirus infections driven by the Delta variant.
Vaccinations rates are low in the South and Midwest and some states like Florida and Texas have banned mask mandates.
The quits rate shot up to an all-time high of 2.9% in August from 2.7% in July. The quits rate is normally viewed by policymakers and economists as a measure of job market confidence. The higher quits rate suggests wage inflation will likely continue to build up as companies scramble for workers, who have unlimited choice.
Hiring decreased by 439,000 jobs to 6.3 million. The decline was led by the accommodation and food services industry, where payrolls dropped by 240,000 jobs. Hiring at state and local government education declined by 160,000 jobs.
The decrease in hiring was more pronounced in the Midwest region. The hiring rate fell to 4.3% from 4.6% in July.
The government reported last Friday that nonfarm payrolls increased by only 194,000 in September, the smallest gain since December 2020, after increasing 366,000 million in August.
Job openings, a measure of labor demand, dropped 659,000 to a still-high 10.4 million on the last day of August. There were 224,000 fewer vacancies in the health care and social assistance sector. Job openings in the accommodation and food services industry fell by 178,000. States and local government education vacancies dropped by 124,000 positions.
Regionally, job openings fell in the Northeast and Midwest. The job openings rate dropped to 6.6% from 7% in July.
Source: Read Full Article