(RepublicanInformer.com)- Americans are leaving their jobs voluntarily at the highest rate in history.
Total quits hit a record number of 4.3 million people in August, according to the monthly Job Openings and Labor Turnover Survey released by the Department of Labor this week. That was an increase of roughly 242,000 over the month before.
In total, there are roughly 10 million job openings across the country. With the labor market tightening and companies increasing wages to try to lure workers, inflation could remain high for quite a while.
The labor crunch is combining with a shortage in raw materials that is crippling growth around the country. As the chief economist at FWDBONDS, Christopher Rupkey, recently told Reuters:
“There are help-wanted posters in every shop window on Main Street, and the lack of workers is exacerbating the supply disruptions throughout the nation that is lighting a match to the fire of inflation. The labor market has already recovered.”
Of the 4.3 million people who quit their jobs in August, 157,000 in the food services and accommodation industry. Another 26,000 left their jobs in the wholesale trade industry, while 25,000 left their jobs in local and state government education.
The Reuters report said a lot of people are likely leaving their jobs over fear of being infected with COVID-19. In fact, the largest number of quits occurred in the Midwest and South, where coronavirus infections surged the most because of the Delta variant.
Rates of vaccination are also low in these region, particularly in states such as Texas and Florida where mask mandates have been banned.
The quits rate increased from 2.7% in July to 2.9% in August, which is the highest it’s ever been. Many economists and policymakers view the quits rate as a good measure of confidence in the job market.
A higher quits rate, then, would suggest that wage inflation would likely continue as companies are fighting for workers, who now have a virtually unlimited choice in where they want to work.
JPMorgan economist Daniel Silver explained:
“These readings are also consistent with strong demand for labor, with people feeling confident in their abilities to get new jobs and not many layoffs taking place.”
Wall Street stocks have been lower in recent days over concerns about upcoming earnings calls for the third quarter and the overall impact that inflation is having on the economy.
While the job market has rebounded from the worst doldrums of the height of the pandemic, vacancies are still 49% above where they were before the pandemic began. The vacancy rate is also currently the second highest in history.
In August, there were 0.8 people per job opening, according to the report.
The lead U.S. economist for Oxford Economics, Lydia Boussour, commented:
“The JOLTS report continues to suggest that the labor market isn’t as loose as the current 5 million jobs shortfall would indicate.”