Job Openings and Quits Remain Near Record Highs, Layoffs Fall to a Record Low

The April JOLTS report released today by the U.S. Bureau of Labor Statistics points to a robust and vibrant labor market, and the tightest on record. There were 11.4 million job openings—63% more than before Covid, and almost twice as many as the number of unemployed job seekers. And 4.4 million workers quit their jobs. Both of those numbers are near their all-time record highs.

Meanwhile, layoffs and discharges fell to 1.2 million, well below the pre-Covid average of 1.9 million and a new record low—an indication that employers are hanging onto the workers they have in a tight labor

market where replacing them is unusually costly. On top of that, blockbuster job openings figures from the record-breaking March report were revised upwards.

Here are the key takeaways from the report:

Employer demand for workers remains extremely high

• Job openings were at record levels in the midwest, as well as in construction and manufacturing (both durable and nondurable).

• Compared with pre-Covid levels, job openings are up 152% in manufacturing, 129% in other services, and

96% in transportation, warehousing, and utilities.

• Job openings for small businesses with 10 to 49 employees are at record high. With 3.3 million job openings, small businesses have 111% more vacancies than before the pandemic.

U.S. workers are enjoying unprecedented employment security

• Most workers are at-will employees who can be laid off or fired at any time with limited notice. But in this tight labor market, employers are proving reluctant to terminate employees, even when employees—or the businesses themselves—are underperforming. Employers know that replacing workers now will be more time-consuming and costly than usual, given a job fill rate of 57.7% (the number of hires completed in a month divided by the number of job openings) which is well below the pre-Covid average of 1.2.

• Layoffs and discharges overall fell to 1.2 million—37% below their normal pre-Covid level.

• Layoffs hit a record low in small businesses with 10 to 49 employees with only 0.7% of their workforce being terminated involuntarily in April. Small business employment is typically relatively precarious, but it is now more stable and secure than ever before on record.

The Great Resignation is not yet letting up

• There is still tremendous churn in the labor market with about a million more workers quitting their jobs each month than usual. The vast majority are trading up, leaving their jobs for better ones in an environment marked by more numerous, more attractive, and more accessible opportunities.

• Compared to pre-Covid levels, quits are up 93% in real estate and

rental and leasing, 84% in manufacturing, 49% in construction, and 38% in state and local government.

• Small businesses with less than 50 employees suffer more in the Great Resignation compared to other size classes. With nearly 2 million small businesses, employees quit their jobs in April, accounting for almost half (48%) of all job hoppers in the economy.