Employers posted a record 11.5 million job openings in March while a record 4.5 million workers quit their jobs — more evidence of a tight labor market that has emboldened millions of American workers to seek better paying positions.
Layoffs remain below their pre-pandemic levels of about 1.8 million a month, with about 1.4 million layoffs in March, slightly higher than the 1.35 million job cuts in February, the Bureau of Labor Statistics reported Tuesday.
The U.S. job market is on a hot streak. Employers have added an average of more than 540,000 jobs per month for the past year. The Labor Department is expected to report Friday that the economy generated another 400,000 new jobs in April, according to a survey by the data firm FactSet. That would mark an unprecedented 12th straight month that the hiring has come in at 400,000 or more.
“The labor market is still very much a job seeker’s market,” Indeed Hiring Lab director of economic research Nick Bunker said in an email. “Despite concerns about an imminent recession, employers are still looking to hire at near historic rates — and are desperately holding on to the workers they have.”
The U.S. economy and job market have come roaring back with unexpected strength from 2020’s brief but devastating coronavirus recession, fueled by massive government spending and super-low interest rates engineered by the Federal Reserve.
Caught off guard by the sudden rebound in consumer demand, companies have been scrambling to hire workers and stock their shelves. But the labor market has yet to rebound to its pre-pandemic strength, with the labor force participation rate still below its February 2020 level. Early retirements, lack of child care for workers with children and other issues have been blamed for the ongoing worker shortage.
With more competition for fewer workers, employers have been forced to raise wages and add benefits. Meanwhile, factories, ports and freight yards have been overwhelmed with traffic. The result has been shipping delays and higher prices.
In March, consumer prices rose 8.5% from a year earlier — the hottest inflation since 1981.
Where things go from here is uncertain. The Fed is raising short-term interest rates to combat inflation, with the central bank expected to boost rates by 50 basis points on Wednesday.
The COVID-19 stimulus from the federal government is gone. And the war in Ukraine has clouded the economic outlook. Despite strong hiring, the United States is still 1.6 million short of the jobs it had in February 2020, just before the coronavirus hit the economy — and that shortfall does not take into account the additional jobs that should have been added by a growing population.