September Turnover Shows Impact of Delta Variant on Hiring and Retention – Better Days Ahead?

November 12, 2021
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Author: Mallory Vachon, Ph.D., Sr. Economist

Total job openings across the U.S. remained steady at 10.4 million in September — the same as August — per the JOLTS report (Job Openings and Labor Turnover Survey), the U.S. Bureau of Labor Statistics (BLS) reported Nov. 12. The numbers track the volume of job openings, hires, quits and other separations, reported on a two-month delay.

The September 2021 JOLTS report shows strong hiring but high churn from another record number of quits.

The Delta variant limited businesses’ ability to fill open roles in September, but the sheer number job openings also contributed to a record-level 4.4 million quits — up from 4.3 million in August — as workers sought new opportunities for higher pay, better benefits or more flexibility. Supply-chain issues and overall uncertainty have made it difficult for businesses to make and sell products. Despite these challenges, hiring in September remained relatively stable at 6.5 million jobs.

These September numbers — which reflect business decisions made during the peak of cases related to the COVID-19 Delta variant — come one week after a better-than-expected October jobs report on Nov. 5. There’s reason to be optimistic that next month’s JOLTS numbers could show even more hiring.

Top Industries for Job Openings

The industries with the most job openings for September also employ a large share of the U.S. workforce.

  1. Health Care & Social Assistance: 1,741,000
  2. Accommodation & Food Services: 1,378,000
  3. Retail Trade: 1,121,000
  4. Manufacturing: 897,000
  5. Transportation, Warehousing & Utilities: 589,000

The Good News – September 2021 Top Industries for Net Hires

These industries had the biggest positive difference in most hires minus separations (voluntary quits, involuntary layoffs and firings, retirement and death):

  1. State & Local Government (Excluding Education): +39,000
  2. Transportation, Warehousing & Utilities: +36,000
  3. Retail Trade: +34,000
  4. Accommodation & Food Services: +29,000
  5. Health Care & Social Assistance: +27,000

The Bad News – September 2021 with the Most Quits

These industries had the most workers leaving their jobs — accounting for more than two-thirds of all quits — caused primarily by voluntary employee resignations:

  1. Accommodation & Food Services: 863,000
  2. Professional & Business Services: 706,000
  3. Retail Trade: 685,000
  4. Health Care & Social Assistance: 589,000
  5. Manufacturing: 337,000

Part of this churn is simply the nature of these industries, but the lingering impact of COVID-19 continues to contribute to increased turnover. The high expense of constantly hiring, onboarding and training new employees could be moderated if these employers focus on improving retention through offering competitive pay and improved training and working conditions, as business allows. Compensation and labor-market analytics software, such as LaborIQ® by ThinkWhy, are useful for companies with an interest in improving retention.

“LaborIQ

Labor Force Outlook

ThinkWhy projects the U.S. will reach — or even exceed — 73 million hires for 2021, through a combination of filling current job openings, backfilling jobs and adding new jobs. With 6.5 million jobs in September, this estimate is on track. Job gains were well-below expectations in August and September, with the Delta variant reaching its peak in mid-September. October’s better-than-expected job gains provide a boost to the recovery and hopefully signal increased hires through the end of the year.

LaborIQ by ThinkWhy reports, forecasts and advises on employment conditions and the impact to jobs, industries and businesses across all U.S. cities.