A record 4.4 million Americans quit their jobs in September as the sheer volume of available jobs is empowering workers to have their pick.
Workers are quitting in search for better pay or better jobs, representing a fundamental shift in America’s labor market.
“Labor now has the initiative, and the era of paying individuals less than a livable wage has ended,” said Joseph Brusuelas, chief economist at RSM US. “This strongly suggests that rising wages are going to be part and parcel of the economic landscape going forward.”
The nation had 10.4 million open jobs that month as the worker shortage crisis continues, data from the Bureau of Labor Statistics showed Friday. It was a modest decrease from the 10.6 million open jobs in August.
Jobs particularly increased in the health care and sector and in state and local government.
“The Delta variant is still visible in the September JOLTS report,” said Nick Bunker, director of economic research at the Indeed Hiring Lab, in emailed comments. But he noted “we do know from the October jobs report that the labor market did get on more stable ground.”
The slowing demand for workers in the leisure and hospitality industry was the cause of the modest decline in available jobs in September.
“The pace of people quitting across the labor market is remarkable,” Bunker said, “but the concentration among a few sectors is eye-popping. Quits are up the most in sectors where most work is in-person or relatively low paying.”
The arts, entertainment and recreation sector saw the largest increase in quits, followed by other services and state and local government education.
Employers hired 6.5 million people, while separations — which include voluntary quits — stood at 6.2 million. Compared with the huge number of jobs available, this underscores America’s worker shortage problem.
During the pandemic, millions of workers have dropped out of the labor force. For some, care responsibilities at home prevent them from going back to work, while for others the risk of contracting the virus is still too high. These factors particularly affected women: As of October, the number of women not in the labor force was nearly 3 million people higher than before Covid.
But even if all of these women went go back to work, America would still have additional jobs to fill.
As of September, the nation was still short 4.7 million jobs compared with February 2020, before the pandemic hit. Job creation slowed in August and September amid the threat posed by the Delta variant but sped up again in October, as last week’s jobs report showed.