U.S. employers announced just 20,485 layoffs in August, the lowest year-to-date total since 1993, according to data released Thursday by outplacement firms Challenger, Gray & Christmas.
A separate report from the Labor Department said initial jobless claims for the week ending Aug. 27 fell to 232,000, down 5,000 from the previous week’s level and revised downwards at 6,000 claims. Your bill is now at its lowest level in two months.
Recent employment data, including the July jobs report and turnover survey, came after the labor market neared recovery from the pandemic and as the Federal Reserve took extreme steps to curb and contain inflation. defied expectations by analysts and economists that the labor market would cool. demand.
“The labor market is not just a frenzy, it’s a hell on fire,” said Megan Greene, global chief economist at the Kroll Institute and a senior fellow at Brown University.
The Federal Reserve sees the current ratio of two job openings to all job seekers as a potential driver of higher wages, which will lead to higher prices and lower inflation. We believe it will continue to rise. Friday’s federal jobs report will watch closely for signs of slowing job growth.
Economists estimate that about 300,000 jobs will be added in August. This is his first monthly increase since April 2021, down sharply from July. The August jobs report is due to be released on Friday morning.
layoffs looming
Most of these announcements are of technology and technology-adjacent companies expanding their workforces to meet the sudden demand for services during the pandemic.
“Things are cooling down again, so these industries [scale back] About the jobs they did,” he said.
as a pandemic Mitigation, other industries see more demand. In 2020-2021, people are back to spending on vacations, dining in restaurants, and other areas of service, but those activities weren’t easily accessible in his 2020-2021. The change has weakened some companies, said Gus Faucher, senior vice president and chief of his economist. With PNC Financial Services Group. “Having said that, the demand in the economy is still strong and many businesses are still understaffed, so it is fairly easy for laid-off workers to find new jobs.”
But companies still need workers
“What they are likely to do is, if a position opens, they will be slow to fill that position in anticipation of what will happen,” he said.
There are several systemic challenges to closing the labor shortage gap.Small workforce Below pre-pandemic levels, the labor force participation rate has fallen from around 67% in the early 2000s to just above 62% in July. Economists had expected that percentage to rise as the economy added jobs. But this year it really fell.
“Those four to five percentage points represent the millions we really need,” says Hetrick.
Economists have no idea who these missing workers are and who they are due to lack of childcare, health-related concerns, potentially restrictive immigration policies, and early retirement that hastened decades of demographic dynamics. We’re continuing to look into what’s keeping us out of the workplace.
Bonnie Dowling, associate partner at business consulting firm McKinsey, said the scales still tipped heavily toward workers despite growing economic uncertainty.
Dowling was a co-author of a recent McKinsey report that sought to address a severe shortage of workers and what may be turning young employees into side jobs.
Aspects such as workplace flexibility, meaningful work and rewards were cited as some of the key desires, according to the report.
“We have to fundamentally rethink how we work,” she added.
