According to the Department of Labor 4.2 million individuals left their jobs this October showing that the “Great Resignation” is still going strong. This trend, which has left widespread labor shortages across the country in its wake, has left many employers desperate to figure out if and when this trend might let up.
Fortunately for employers, there are some signs of improvement as the number of employees quitting has declined from its highs in September. However, with still near record-breaking numbers of job openings in October at approximately 11 million, just shy of July’s record-setting number, most employers will likely find themselves continuing to struggle to find enough workers for the time being. Currently, this is still clearly the case as the number of new hires in the month dropped to 6.5 million.
Interestingly, given that in October, the Department of Labor indicates that there were 7.4 million individuals unemployed, this would indicate that there were about 1.5 openings for every one of these unemployed workers. This is the highest number in decades and clearly highlights the struggle that employers are likely to face in finding enough workers to fill their needs. Further, this shortage of workers has placed the advantage in the workers’ hands when it comes to negotiations.
One factor leading to these shortages is the fact that many Americans still haven’t returned to work since the pandemic. For some, this is due to fear of contracting COVID-19, and for others, it simply is not a pressing issue due to remaining funds from stimulus checks and the generous unemployment benefits issued earlier in the crisis. Workers staying out of the labor market due to these issues will likely begin actively looking for work again in time. However, this still may not solve the problem as many workers may not be returning to the labor market, such as workers who are 55 or older and left due to retirement.
At the same time, as these issues have led to labor shortages, many employers have raised wages and introduced hiring bonuses in order to entice employees to work for them. These incentives, in turn, lead employees to quit their current jobs to pursue these better opportunities, and this has helped lead to a record number of resignations.
Other major factors leading to these incredible numbers include:
Though the current record-breaking numbers of resignations employers have been seeing are certainly causing difficulty, the silver lining is that the numbers of resignations are declining again. With the accelerating economy and dropping numbers of resignations, it is possible that employers may find themselves more capable of filling their rosters in the next few months.
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