WRAPUP 1-US leaves record in August; hiring drops
* Job vacancies drop from 659,000 to 10.4 million in August
* Voluntary departures increase from 242,000 to 4.3 million
* Hiring shows the biggest drop in eight months
By Lucia Mutikani
WASHINGTON, Oct. 12 (Reuters) – The number of Americans voluntarily leaving their jobs hit an all-time high in August, as hires fell the most in eight months, underscoring the challenges businesses face as they attempt to fill millions of vacant positions.
The Ministry of Labor’s monthly job openings and turnover survey, or JOLTS report, followed Tuesday’s announcement last Friday that the economy created the fewest jobs. in nine months in September. The JOLTS report, which also showed more than 10 million job vacancies in the economy, was another reflection of an economy struggling with shortages, which are spurring inflation and holding back growth.
âThere are help-seeking posters in every Main Street storefront, and the lack of workers is worsening supply disruptions across the country, igniting the fires of inflation,â said Christopher Rupkey, chief economist at FWDBONDS in New York.
Departures increased by about 242,000 in August, bringing the total to a record 4.3 million. There have been 157,000 people who quit in the accommodation and food services industry while 26,000 have left the wholesale trade sector. Public and local education recorded 25,000 departures.
People are most likely leaving their jobs for fear of contracting COVID-19. The number of dropouts has increased in the southern and midwestern regions, which have taken the brunt of the summer wave of coronavirus infections driven by the Delta variant.
Vaccination rates are low in the South and Midwest, and some states like Florida and Texas have banned mask warrants.
The drop-out rate hit an all-time high of 2.9% in August, down from 2.7% in July. The quit rate is normally viewed by policymakers and economists as a measure of confidence in the labor market. The higher quit rate suggests that wage inflation is likely to continue to pile up as companies scramble to find workers, who have unlimited choice.
Hires fell from 439,000 jobs to 6.3 million. The decline was led by the accommodation and food services industry, where payrolls fell by 240,000 jobs. Hiring in public and local education fell by 160,000 jobs.
The drop in hiring was most pronounced in the Midwest region. The hiring rate fell to 4.3% from 4.6% in July.
The government reported last Friday that the non-farm workforce only increased by 194,000 in September, the smallest gain since December 2020, after increasing by 366,000 million in August.
Job vacancies, a measure of labor demand, fell from 659,000 to an all-time high of 10.4 million on the last day of August. There were 224,000 fewer vacant positions in the health care and social assistance sector. Job vacancies in the accommodation and food services industry fell by 178,000. Job vacancies in state and local education fell by 124,000.
Regionally, job openings have plummeted in the Northeast and Midwest. The vacancy rate fell to 6.6% from 7% in July.
(Reporting by Lucia Mutikani; Editing by Andrea Ricci)