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Monday, Jan 05, 2026

Americans are quitting jobs at record rates, while job openings tick down

Americans are quitting jobs at record rates, while job openings tick down

Americans quit their jobs at a record-high pace in August, with almost 3% handing in their resignations, the government reported on Tuesday. The number of quits increased in August to 4.3 million, which is 242,000 more than in July. The quits rate increased to a new high of 2.9%.

By comparison, employers laid off 1.3 million workers in August.

The Labor Department said the jump in quits is the highest on records dating back to December 2000, and up from 4 million in July. Hiring also slowed in August, the report showed, and the number of open jobs fell to 10.4 million, from a record high of 11.1 million the previous month.

The data strongly suggest that the Delta variant wreaked havoc on the job market in August: As COVID-19 cases surged, quits jumped in restaurants and hotels and rose in other public-facing jobs, such as retail and education.

"Job openings fell in August for the first time this year," Nick Bunker, director of research at the Indeed Hiring Lab, said in a note. "The decline here suggests that the rising case counts in August tempered employer demand for new hires. At the same time, the quits rate for leisure and hospitality jumped by over 20% in just one month," he said.

Quits also rose the most in the South and Midwest, the government said, the two regions with the worst COVID outbreaks in August.

Last month, about 9 million people lost all their unemployment benefits with the expiration of two federal programs that covered gig workers and people who had been jobless for more than six months. An additional 2 million people have lost a $300-a-week federal supplement to state unemployment benefits.

When workers quit, it is typically seen as a good sign for the job market, because people typically leave jobs when they already have another position or are confident they can find a new one. The large increase in August likely reflects the fact that, with employers desperate for workers and raising wages, many workers feel they can get better pay elsewhere.

But the fact that the increase in quits was heavily concentrated in sectors that involve close contact with the public is a sign that fear of COVID also played a large role. Many people may have quit even without other jobs to take.

"The August JOLTS report shows employers and workers were anxious about the rising Delta COVID-19 wave two months ago," Robert Frick, corporate economist at the Navy Federal Credit Union said in a note. "Workers quit, especially in retail, at a record rate to avoid exposure to possible infection. Job openings dropped, especially in leisure and hospitality, as travel dropped markedly due to Delta," Frick said.

Hiring in September slowed for a second straight month, the government said Friday, with only 194,000 jobs added. Economists had expected about 490,000 jobs to be created.


"Temporary speed bump"?

The nation's unemployment rate fell to 4.8%, from 5.2%, due to a combination of unemployed workers finding jobs and people leaving the labor force, meaning they are no longer counted as unemployed since they are not actively seeking new work. The labor-participation rate, a measure of people working or searching for work, ticked down to 61.6% in September, from 61.7% in August.

Tuesday's report, known as the Job Openings and Labor Turnover survey, or JOLTS, provides a more detailed picture of the job market. The hiring reported on Friday is a net total, after job gains and quits, retirements and layoffs are taken into account. Tuesday's report includes the raw figures, and showed that total hiring in August fell sharply, to 6.3 million from 6.8 million in July.

Looking ahead, economists say the August slowdown does not necessarily indicate a permanent change for the worse. What is clear, however, is that the pandemic continues to be a defining factor in the job market's recovery.

"The question is whether this is a temporary speed bump due to a surge in COVID cases or if demand will continue to slacken in the months ahead," said Bunker.

"The Delta wave didn't reach its peak until mid-September, so the September JOLTS report may also carry bad news. But given the decline in cases and deaths underway, this month may see a strong turnaround in the numbers," Frick said.
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