The number of US job openings stood at 11 million on the last business day of October, data out Wednesday showed.
That was far more than the 10.47 million consensus expected, again underscoring the extent to which worker shortages continue to plague the US labor market.
The number of openings rose 431,000 from September. Hires, by contrast, fell slightly, driving the gap between openings and hires to a new record (figure below).
The data came on the heels of a November jobs report that many described as “weird.” Although the headline NFP print was underwhelming, a look under the proverbial hood revealed so much nuance that parsing the numbers in real time was almost impossible.
To be sure, there were plenty of bright spots, but one disappointing takeaway from last month’s jobs figures was the meager advance in leisure and hospitality, and almost flat read on restaurant and bar hiring.
The JOLTS data released Wednesday showed job openings in accommodation and food services were markedly higher in late October (figure below).
The 250,000 increase was the largest of 2021 and the second most in series history.
The latest data provided plenty of new evidence for any “Great Resignation” stories the media is inclined to (re)write.
Although the quits rate fell, it remained extraordinarily elevated at 2.8% (figure below). Outside of 2021, that’s unheard of.
4.2 million people quit in October, down slightly from September’s 4.4 million, but still the third highest on record.
The staggering number of quits speaks to multiple, overlapping dynamics including intense competition for a smaller labor pool, a reluctance on the part of some workers to reengage amid persistent virus flare-ups, early retirements and what I continue to believe is generalized apathy on the part of disaffected Americans for whom the pandemic was the last straw after decades spent watching labor (as an economic actor) lose almost all leverage in the age-old struggle with capital.
As the government flatly noted Wednesday, the number of layoffs and discharges was little changed as was the layoffs and discharges rate.
Although the November jobs report suggested participation is recovering, it’s painfully obvious that, much like inflation, the frictions holding back the US labor market aren’t “transitory.”
Of course, the longer the conjuncture illustrated by the visuals (above) persists, the more upward pressure on wages and the higher the risk of a wage-price spiral.
Americans who find it difficult to muster $400 in an emergency are not going to fix this problem for businesses looking to pass along higher costs. Wages will have to go up to reflect the real cost of living, operating margins will have to come down, and we’ll all have to accept lower share prices. Small price to pay, it seems to me, for a more equitable distribution of the wealth produced by our financialized economy and the chance to hold on to our democracy.
mfn
I agree with your view in general but it is not obvious to me that equitable wealth distribution and holding on to democracy are high priorities for most people. It seems like the clattering cry demanding the freedom to be stupid and the rush to turn over all but gun rights to the government are now the top priorities, at least in states like KS, MO, IA, and other area states.
Belately, increasing attention is being paid to the effect of long Covid on the labor supply. Estimates of the number of Americans who have been infected range from 60 million to 100 million. Some studies suggest up to a quarter of persons who contract and apparently recover from Covid subsequently seek treatment for related conditions. I don’t know of reliable estimates for the percent of Covid cases that result in persistent conditions sufficient to affect the person’s ability to work. If (?) it were 1-2%, that would be 0.6 million to 2.0 million people lost from the labor supply, at least temporarily. The lasting effect of the pandemic will probably include impacts on the labor supply, health care spending, and household income.
The following is not original to me: 60% of Americans pay no federal income tax- because 60% don’t make enough money to pay income tax. The upper 20% had a very good covid. If we unwind globaliztion of the supply chain and cope with the fact that we have little or no robust systems because financialization of the economy forced the wrong priorities and gave us artificially low cost of goods and labor- the reform period (10 to 20 years) will be very rough- socially, economically and politically.
Just drove by a Mcdonald’s restaurant and they are now offering $21/hour for help!! (And I thought the Burger King I saw previously offering $17/hr was high for fast food workers)! Maybe wages for lower to middle class earners is finally heading up? (Hopefully faster than inflation….).
I think part of this is wrapped up in the two largest generations not participating in the workforce simultaneously. Baby Boomer and Millennials comprise 40% of the population. Boomers are either at retirement age already or retiring early thanks to possession of most of the nation’s wealth. Millennials saddled with more student debt than they can afford to pay with mediocre wages and able to create income streams from new technologies better than they can from the traditional workforce are leaving the workforce. Crypto, social media, podcasting, blogging, and YouTubing are all ways for those raised on technology to earn income in a more desirable manner than agreeing to all of the various workplace standards and HR policies the average employer provides.
To entice this workforce to come back to work a lot more than higher salaries are going to be required.
Fred Wilson (from USV) was mentioning the fact that small cies are being created at a rapid pace as a possible explanation? ie people are quitting/not getting back to work for an employer but launching their own businesses?
Dunno. ‘could explain the uptick in labor participation…