Health

Job openings remain near a record, and more workers quit than ever

Yet despite
that leverage, an overwhelming majority of Americans say they are worried about
inflation — and most say their pay is not keeping up with rising prices.

That
contrast — evident in survey results released Tuesday — underscores the
strange, contradictory moment facing the US economy after two years of pandemic-induced
disruptions.

For some
workers, particularly at the lower end of the pay scale, the intense
competition for labour has created a rare opportunity to demand better pay and
working conditions. But for those who cannot change jobs as easily or who are
in sectors where demand is not as strong, rising prices are yet another
challenge in a period that has been full of them.

Those
crosscurrents are at least partly a result of the remarkable strength of the
economic recovery. After collapsing in the first weeks of the pandemic,
consumer spending quickly rebounded and eventually reached record levels, fuelled
by hundreds of billions of dollars in federal aid. Businesses, whipsawed by the
sudden reversals, struggled to keep up with demand, leading to supply chain
snarls, labour shortages and rising prices.

The
stubborn nature of the pandemic itself contributed to the problems, upending
spending patterns and keeping workers on the sidelines.

There are
signs that the worst of the problems were beginning to ease late last year. The
number of job openings posted by employers fell in November, the Labor
Department said Tuesday, though it remained high by historical standards.
Hiring picked up, too. Earlier data showed that more people returned to the
labour force in November, and various measures of supply chain pressures have
begun to ease.

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But that
was before the explosion in coronavirus cases linked to the omicron variant,
which has forced airlines to cancel flights, businesses to delay
return-to-office plans and school districts to return temporarily to remote
learning. Forecasters say the latest COVID-19 wave is all but certain to
prolong the economic uncertainty, though it is too soon to say how it will
affect inflation, spending or the job market.

Americans
are pessimistic about the economy. Only 21% of adults said their finances were
better off than a year ago, according to a survey released Tuesday — down from
26% when the question was asked a year earlier, even though, by most measures,
the economy had improved substantially during that period. The survey of 5,365
adults was conducted last month for The New York Times by Momentive, the online
research firm formerly known as SurveyMonkey.

Overall
consumer confidence is at the lowest level in the nearly five years Momentive
has been conducting its survey. Republicans have been particularly pessimistic
about the economy since President Joe Biden took office a year ago, but in
recent months, Democrats too have become more dour. Other surveys have found
similar results.

Inflation
appears to be a big reason for people’s dark outlook. Nearly 9 in 10 Americans
say they are at least “somewhat concerned” about inflation, and 6 in 10 are
“very concerned,” the survey found. Worries about inflation cross generational,
racial and even partisan lines: 95% of Republicans, 88% of independents and 82%
of Democrats say they are concerned.

“Pretty
much the only group of people who say they’re better off now than they were a
year ago are people who’ve gotten a pay raise that matches or beats inflation,”
said Laura Wronski, a research scientist at Momentive.

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There are
not many of them. Only 17% of workers say they have received raises that kept
up with inflation over the past year. Most of the rest say either that they
have received raises that lagged behind price increases or that they have
received no raise at all; 8% of respondents said they had taken a pay cut.

Government
data likewise shows that, in the aggregate, prices have risen faster than pay
in recent months. The Consumer Price Index rose 6.8% in November, a nearly
four-decade high; average hourly earnings rose 4.8% in November; and other
measures likewise show pay gains lagging behind price increases.

Yet some
workers are seeing much faster wage growth. Hourly earnings for leisure and
hospitality workers were up 12.3% in November, much faster than inflation.
Workers in other low-wage service sectors are also seeing strong gains.

Many of
those workers are getting raises by being willing to hunt for better opportunities.
Data from the Federal Reserve Bank of Atlanta shows that job-switchers are
getting significantly faster pay increases than people who stay in their jobs.

More than
4.5 million people voluntarily left their jobs in November, the Labor Department
said Tuesday. That was up from 4.2 million in October and was the most in the
two decades that the government has been keeping track. The rate of quitting
has been especially high in hospitality and other low-wage sectors, where
strong demand has given workers the leverage to seek out better pay.

“The quits
rate is a sign that at the end of 2021, workers were in an advantageous
position in the labour market and were flexing their power by going out and
finding new jobs,” said Nick Bunker, director of economic research at the
Indeed Hiring Lab.

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Much of the
public discussion around the increase in quitting — sometimes referred to as
the Great Resignation — has focused on white-collar workers reevaluating their
priorities in the pandemic. But Bunker said the data suggested a different
story.

“This Great
Resignation story is really more about lower-wage workers finding new
opportunities in a reopening labour market and seizing them,” he said.

© 2021 The
New York Times Company

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