The COVID-19 pandemic has had a profound impact on America’s labor force, leading to what many have dubbed „The Great Resignation.“ In 2022, more than 50 million workers decided to quit their jobs, following the 47.8 million who did so in 2021. However, in 2023, this trend began to subside, with 30.5 million workers resigning as of August.
This phenomenon can be better described as „The Great Reshuffle,“ as many workers have been transitioning to other jobs in search of an improved work-life balance, increased compensation, or a stronger company culture. While quit rates remain high, hiring rates continue to outpace them, indicating a significant shift in the labor market dynamics.
The U.S. Chamber of Commerce is closely monitoring trends in job openings, labor force participation, and quit rates affecting industries nationwide. The organization provides valuable insights into the industries most significantly impacted by these trends, offering a comprehensive analysis of the current state of the workforce.
One industry that has struggled to retain workers is the food service and hospitality sector. Jobs that require in-person work and traditionally offer lower wages have faced challenges in retaining employees, even before the pandemic. The leisure and hospitality industry has experienced the highest quit rates, with the accommodation and food services subsector consistently seeing quit rates around or above 4 percent since July 2022.
Despite the high quit rates, hiring rates across all industries have continued to outpace them. For example, in the leisure and hospitality industry, although 781,000 workers left their jobs in January 2024, 1.05 million people were hired into the industry during the same month. This trend is indicative of the ongoing reshuffling of the labor force as workers seek better opportunities elsewhere.
When examining the labor shortage across different industries, the education and health services sector, as well as the professional and business services sector, consistently have the highest number of job openings. On the other hand, industries such as financial activities and manufacturing, which offer more stable and higher-paying jobs, have seen lower rates of employee turnover.
The manufacturing industry, which suffered a significant setback during the pandemic, has been making strides towards recovery. However, there are still 622,000 total manufacturing job openings yet to be filled as of January 2024. In contrast, the construction industry faces a labor surplus, with more unemployed workers seeking employment than there are job openings available.
Overall, all industries are actively seeking new hires, with varying rates of hiring across different sectors. The mining and logging industry, for example, hired the fewest number of workers from January to December 2023, while the leisure and hospitality sector and professional and business services sector hired significantly more employees during the same period.
Unemployment rates vary across industries, with some sectors experiencing lower-than-average rates, leading to heightened competition for talent. The prevalence of remote work has decreased since the peak of the pandemic, with certain industries, such as hospitality and food services, transportation, and retail trade, requiring a high degree of in-person work.
The U.S. Chamber of Commerce is actively working to address the challenges faced by businesses in attracting and retaining talent. By removing barriers to workforce entry, offering innovative benefits, and providing opportunities for upskilling and reskilling, businesses can enhance their hiring pools and remain competitive in the evolving labor market.
As the workforce continues to evolve, businesses must adapt to meet the changing needs of employees and the demands of the market. The U.S. Chamber’s America Works Initiative is driving solutions to address the workforce challenges of the future, providing valuable resources for policymakers, businesses, and the public.
In conclusion, „The Great Resignation“ and „The Great Reshuffle“ have reshaped the labor force landscape in America, prompting businesses to rethink their strategies for attracting and retaining talent. By understanding the trends and challenges facing the workforce, businesses can position themselves for success in the evolving labor market.