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Record 4.3 million workers quit their jobs in August

The number of job postings in August took a break from the records it had set in recent months, but a record 4.3 million workers left work, according to the federal job posting summary. employment and labor turnover.

Jobs have gone from a record 10.9 million to 10.4 million – an unexpected drop that experts say could be attributed to contractions in business activity due to the delta variant of the coronavirus, to lower economic expectations, to businesses taking breaks at the end of summer, noise statistics or a combination of the above.

“If we look at broad cross-sections of economic measures, we know that there has been some moderation recently” in forecasters’ expectations, said Mark Hamrick, chief financial analyst at Bankrate. The International Monetary Fund slashed its projection for US gross domestic product growth this year by one percentage point, slashing its forecast Tuesday from 7% to 6%.

“There continues to be a lot of remarkable cross currents in the economy,” Hamrick said. “Of course there would be a cost to that in terms of employment.”

But with more than 10 million unfilled vacancies, it’s clear that more and more workers are looking for greener pastures. The rate of people leaving their jobs hit a record 2.9%, leading with increases among people leaving jobs in the hotel, restaurant and wholesale trade.

“Considering the fact that we have lower employment levels overall, it’s pretty amazing to see thousands of people quitting,” said Julia Pollak, chief economist at ZipRecruiter.

She suggested that a continued desire to avoid jobs with a lot of face-to-face contact could be behind some of the migration. “It’s interesting how prevalent these record dropouts are. What may be part of what’s going on here is people leaving these areas in place for more remote friendly areas,” a- she declared.

Job vacancies fell the most in two sectors: health care and social assistance, and accommodation and food services, seismic sectors affected by the long duration of the pandemic.

Experts warn that the labor shortage is weighing on the ability of family businesses to thrive and even, in an increasing number of cases, survive. The Alignable small business networking platform found that a third of restaurant owners surveyed expressed doubts about their ability to get through the holidays without closing their doors. Inability to hire was cited as a key factor, said Eric Groves, co-founder and CEO of Alignable, who warned that other types of businesses that rely heavily on labor to generate revenue. incomes, such as personal services and transportation, face similar risks.

“Anywhere where work is the crux of income, it is a challenge,” he said, pointing to anecdotal reports of restaurants and family-owned stores that have closed their doors completely for much of the month. week. “The problem is when you are understaffed… you have to give your staff a break so that you can provide the level of service you want. “

Groves said businesses of all stripes have had to increase their wages – in addition to paying higher costs for supplies, ingredients and other raw materials – but many have struggled to find workers.

A new survey from the National Federation of Independent Businesses, or NFIB, found that a record 51 percent of small businesses reported being unable to fill jobs. “It is an incredibly difficult time for those with vacant positions to find and attract candidates,” said Holly Wade, Executive Director of the NFIB Research Center.

“For many of them, they don’t get any applications – there just aren’t any resumes right now,” she said, though a record 42% of small businesses said they had increased their salaries and 30% said they plan to do so. so in the next three months. Wade said the high turnover of the existing workforce compounds the challenge.

The shortage is weighing more and more on the future prospects of business owners: The NFIB survey found that small business optimism has dropped and owner uncertainty has increased. This weighs on growth plans, such as capital investments, according to the survey.

Despite the contraction in job vacancies, Wade said, the labor shortage remains a cloud over the economic recovery. “I don’t think this problem is easing anytime soon,” she said. “Small business owners plan to deal with this until 2022.”