The historic rates of quitting continued through the end of 2021, according to the latest federal Job Openings and Labor Turnover Survey (JOLTS) report. Workers continued to switch jobs in light of the many opportunities the current labor market provides, with the private sector quits rate hitting an all-time high of 3.4%. Of course, whether these conditions continue into 2022 is one of the biggest questions for the year ahead.
The overall number of job openings ticked down in November, led by declines in both the service sector and goods-producing industries. Demand for workers in the leisure and hospitality sector is quite strong, but it is notable that openings in that sector peaked back in July. Hiring in that sector is still robust, suggesting that some of the hiring difficulties might be easing.
Workers continued to quit their jobs at a historic rate. The low-wage sectors directly impacted by the pandemic continued to be the source of much of the elevated quitting. For example, the quits rate was 6.9% for accommodation and food services. Lots of quits means stronger worker bargaining power which will likely feed into strong wage gains. Wage growth was very strong in 2021, and if we keep seeing the quits rate near 3%, we might see more of the same in 2022.
Of course, these data were measured before the omicron variant had spread in the United States. While each successive wave of the pandemic caused less economic damage, there is still a risk to the labor market from the current surge of cases. Hopefully any disruption is temporary and minimal, because the outlook for 2022 is strong.
