In August, the number of people quitting their jobs reached an all-time high, with restaurants and retail outlets experiencing the biggest hit. Such an occurrence has led to a shortage of staff in various essential sectors, and consumers have been short-changed in getting adequate services.
According to the released stats, workers who quit their jobs amounted to 4,3 million in August, and this is the highest figure to be recorded since December 2000. A closer analysis revealed that employees were dropping their professions at a fast pace and left many vacancies in companies. “Bar and restaurant employees as well as retail staff” were seen “quitting in droves,” as noted by the Labor Department on Tuesday.
A survey by the Department of Job Openings and Labor Turnover Survey denoted that “the quits rate rose to 2,9%,” which translates to a 242 000 increment from the previous month, which recorded a rate of 2,7%. The rate is measured against the total employment pool, and analysts marked it the highest since the early 2000s.
Normally, a person who quits a job is confident enough to get another one which might be better than the previous one. In most cases, people feel the need to change jobs in pursuit of more finances or better working conditions, and the new job will come as an improvement from the old one. The outbreak of the coronavirus pandemic in 2020 changed most of the labor dynamics, and it was hard to secure a new job position because many companies were retrenching their staff and small businesses collapsed.
Factors responsible for fuelling job quitters are linked to the health conditions of workers and child care issues, and these reasons were viewed as the devastating effects of covid-19. Senior economist at the Economic Policy Institute outlined corona’s contribution in aiding people to quit and said, “As job openings and hires fell in August, the quits rate hit a new series high, surging along with the rise in Covid cases and likely growing concerns about working in the continuing pandemic”.
Chief economist at Fwdbonds, Chris Rupkey, aired out his views on the effects of employees quitting at a fast rate, and said “There is an enormous labor shortage in the country right now and it is not just because people are quitting or have child care problems, or can’t get to work due to the Delta variant. The economy is strong as a bull; that is why there is a tremendous and demand for labor”. Rupkey’s sentiments stem from the fact that economies across the globe are still recovering from the legal restrictions and lockdowns implemented in various countries. Also, other governments have recommended companies only to allow 40%-50% of their staff to go to work to reduce overcrowding at the workplace. This means that manufacturing and production are running under par, and the economy is being starved in terms of personnel.
Institutions seem not to replace employees who quit as job posting was reduced to 6,6% in August from 7% in July. Hires also “declined by 439 000 for a month in which nonfarm payrolls increased by 366 000,” and the rate was pegged at 4,3% from the previous 4,6%. This was caused by a freeze mode in the leisure and hospitality sector.
The food services outlined that around 892 000 workers left the job and about 721 000 retail workers followed suit, leaving a wide gap that is yet to be filled, and it might take long to replace these trained individuals as expenses are incurred in staff development. From the health care department and social assistance, 534 000 employees departed to pursue new occupations.