Why are people quitting their jobs?
New York (CNN Business)The US jobs recovery has picked up steam again in the final months of the year, bringing some good news in the face of persistently rising prices and a new Covid variant.
Economists polled by Refinitiv expect another sizable jobs gain in Friday’s November employment report — 550,000 positions. If that holds true, it would be the biggest monthly gain since July, when more than a million jobs were added.
But even so, America’s labor market is still not back to its pre-pandemic strength. If the forecasts are right, the nation would still be down more than 3.5 million jobs compared to February 2020.
On Wednesday, ADP Chief Economist Nela Richardson said the recent strong numbers show “good potential for the rest of the year.”
ADP’s own private payrolls report showed 534,000 jobs added in November.
Meanwhile, weekly claims for unemployment benefits fell last month below their pre-pandemic numbers for the first time since the recovery started, dropping below 200,000 to a level not seen since since 1969. In the latest Labor Department data, they were revised even lower to 194,000, adjusted for seasonal swings.
However, last week, claims rose again to 222,000 with seasonal adjustments.
The four-week moving average of benefit claims dropped to 238,750 — the lowest level since the middle of March 2020, when the pandemic’s effect on the labor market began to gain speed.
A new threat
It’s far too early to tell whether the newly identified Omicron variant has the potential to derail all of this progress in the labor market.
The highly infectious Delta variant dented the recovery over the summer, but after revisions to government data, the impact was smaller than initially thought, Richardson told CNN Business.
“The impact will depend on a whole host of factors. But what we can say is in terms of the health conditions on the ground, we as a country are in a much better position than last year when case counts were skyrocketing and very few people were vaccinated,” she said.
Worker shortages and empowerment
Meanwhile, businesses continue to struggle to find staff as the worker shortage has shown little improvement in recent months. As of September, the United States had 10.4 million job openings and the highest quits rate on record.
This is good news for workers who are able to ditch jobs for better prospects in terms of pay, benefits or work-life balance. But for companies it’s a huge issue as demand has come back full force since the height of the pandemic.
To attract workers, business are raising wages and offering signing bonuses.
“We will be looking for signs of recovery in labor force participation rates for women, workers aged 65 and over, and minorities,” said Julia Pollak, chief economist at ZipRecruiter.
This will be particularly important for the holiday period, when consumers are expected to spend big in spite of the high prices.
This should mean strong hiring in retail, transportation and warehousing, Pollack said.
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