Jobs become more secure as bosses fire fewer employees

There has been a lot of attention drawn to the Great Resignation with a record number of Americans quitting their jobs. According to the latest data from the US Labor Department, more than 4 million workers quit their jobs from July through October. The number of employees who voluntarily quit their jobs has never been higher than that number. 

However, on the other end of the spectrum, firings and layoffs have essentially ground to a halt. Julia Pollack, chief economist for an employment site says, "Employers are hanging onto workers for dear life." In October only 1.36 million people lost their jobs, just barely higher than the 1.35 million who were let go in May, when that reading hit a record low. The latest tally shows that there were 227,000 fewer firings and layoffs than even the pre-pandemic low reached in September 2016. It has been down nearly 30% from the average number of layoffs and firings, even excluding the spike in layoffs that occurred in March and April of 2020 at the start of the pandemic. Pollack says that with new weekly jobless claims hitting a 52-year low, it is highly likely that the November and December readings for terminations and layoffs will set even more new records.

There are far more job openings than job seekers. Employers realize how hard it is to fill in positions and are ready to hang onto workers they otherwise might have let go in the past. Data from the Labor Department shows that there are 0.67 job seekers for every job opening or three job openings for every two people looking for work. This is by far the worst ratio for employers since the Labor Department started tracking job openings in 2000. Normally, the average ratio is more than two job seekers for every opening which means that a boss can fire an employee and be assured of finding a suitable replacement quickly without much cost.

Source: CNN