This report once again shows strong demand from employers leading to a hot labor market. The bargaining table is tilted more toward workers than it has been in the past.
The market for new hires continues to be quite tight. The ratio of unemployed workers per job openings hit a new all-time low with 67 unemployed workers per job opening. Prior to the pandemic in February 2020, there were roughly 82 unemployed workers per job opening. The hot market for hires has been driven in large part by the extraordinarily large and fast rise in demand. Given that the rise in openings in this report was likely due to a waning of the latest wave of the pandemic, the question now is whether the omicron variant cools down in the labor market.
The quits rate fell in October, off all-time highs registered in September. The fall was driven in large part by the drop in quitting in the leisure and hospitality sector. The quits rate in those industries dropped by half a percentage point, signaling some easing in job hopping. In addition to the slowdown in wage growth in the sector seen in recent jobs reports, this trend suggests maybe the advantageous situation for workers in this sector might deteriorate in the months ahead if the current situation continues.
As of October, demand for workers was strong resulting in many opportunities for them. However, these data cover a period before the existence of the omicron variant was even known. We’ll have to see how the labor market handles the latest pandemic challenge.