Employers aren’t only struggling to hire new workers, they look as if they are having a hard time hanging onto the workers they already have.
The Labor Department on Tuesday reported that as of the last day of April there were a seasonally adjusted 9.3 million unfilled job openings at U.S. employers, up from 8.3 million a month earlier. That put the job opening rate—job openings as a share of filled and unfilled positions—at a record 6%.
The report underscores the difficulties companies have had staffing up as the Covid-19 crisis has eased. But it also showed that employers made 6.1 million hires, which would be a record if not for the four-month period following the shutting down of the economy in April last year, when many people went back to their old jobs.
However, those hires were almost entirely offset by 5.8 million job separations, 4 million of which were people quitting their jobs. That took the quits rate, or quits as a share of employment, to a record 2.7%.
The upshot is that all the usual explanations for why job growth over the past couple of months has been underwhelming—that child-care issues or extended unemployment benefits or ongoing worries about Covid have held people back from taking jobs—while partially true, may also be incomplete. A lot of workers are also seeking out opportunities elsewhere, leaving their old bosses with another job to fill.
That turnover can be a near-term headache for employers, but all those quits could turn out to be positive for the overall economy. High rates of labor-market churn, with lots of people leaving old positions and taking on new ones, sort workers into the jobs where they can be more productive, boosting growth. It also amounts to a markedly different sort of economic recovery than the one following the 2008 financial crisis, where economists Edward Lazear and James Spletzer found that reduced churn created a significant drag on gross domestic product.
Sometimes quitters really do prosper.
Write to Justin Lahart at email@example.com
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