Key Takeaways:
- Businesses added 312,000 jobs in September;
- Job openings currently stand at 10.4 million;
- Available jobs continue to exceed number who are unemployed;
- Construction accounts for just 3% of all job openings and 4% of those who have quit.
By Manuel Gutierrez, Consulting Economist to NKBA
Although there were fewer job openings in September than in the previous two months, the 10.4 million availabilities are still much higher than at any time last year, and remain near historically high levels.
Figure 1 shows the rapid rise in the number of openings over the last year (note the chart displays two years of data), rising by 3.8 million in the last twelve months from the 6.6 million recorded in September 2020.
The latest drop in job numbers was just 191,000 below those registered in August, barely reducing the number of available openings. However, the total number of individuals employed has been rising. In September, businesses added 312,000 jobs. This is more than the reduction in the number of openings, which means that while openings remain high, businesses and government filled more jobs.
As has been the case for a while, the number of jobs available exceeds the total number of unemployed. Although data on job openings has been available since 2000, it was only in the two years prior to the pandemic that the number of openings exceeded the number of job seekers (Figure 2).
During the height of COVID-19 in April 2020 when the government was forced to temporarily shut down many businesses, the number of unemployed ballooned to 23.1 million. Since then, it has fallen to the current 7.67 million (as of September).
The decline in the number of unemployed is not only due to those who lost their jobs eventually finding employment, but also the result of many leaving the workforce altogether. In some instances, mothers with small children have been forced to leave their jobs because of an inability to find proper day care help. Other reasons have included government subsidies that have provided sufficient income to forego a return to work, or the decision to make a lifestyle change.
The large number of job openings, which reflects a strong demand among businesses and government, has increased the confidence of workers to quit their jobs without fear. This is substantiated by the sharp rise to 4.43 million in September (Figure 3). Historically, this is the highest number ever recorded.
A total of 4.43 million workers have quit their jobs as of September, the highest ever.
The large number of “quits” means that in addition to facing labor shortages, employers need to make an increased effort to retain their current workers. These workers often find better opportunities elsewhere.
Large numbers of workers are quitting across industries in both the goods and services sectors. However, most are concentrated in services, the same areas where the largest number of job openings are found.
Professional & Business Services and Health and Social Services are tied for the lead in openings, accounting for a combined 34% of the total (Figure 4, left panel).
The majority of job quits are in the Leisure sector, with 987,000 or 22% of that total.
In the Construction industry, the number of openings and quits is relatively small. The sector accounts for just 3% of all openings, and 4% of the number quitting.
Charts:
