Despite American businesses generating hundreds of thousands of new job opportunities each month, a considerable number of positions remain unfilled, particularly within the professional and business services sectors.
The Aftermath of the Pandemic
The COVID-19 pandemic has profoundly disrupted the U.S. labor market, giving rise to what has been termed “The Great Resignation.” In 2022 alone, over 50 million workers left their jobs, following a staggering 47.8 million in 2021. By August 2023, the trend showed signs of stabilizing, with approximately 30.5 million resignations recorded.
A more accurate representation of the situation may be “The Great Reshuffle.” Although quit rates remain elevated, hiring trends are increasingly outpacing resignations, as many employees are seeking new roles that offer better work-life balance, higher pay, or a more positive workplace culture.
The U.S. Chamber of Commerce is actively monitoring job openings, labor force participation, and quit rates across various industries. This analysis delves into the sectors most affected by these workforce dynamics.
For a comprehensive overview of workforce conditions, visit the America Works Data Center. An in-depth examination of the worker shortage’s impact on the nation can be found here, along with a state-by-state analysis tracking the situation.
Industries Struggling with Worker Retention
The food service and hospitality sectors have faced significant challenges in retaining staff. Historically, jobs that require full-time in-person attendance and offer lower wages have struggled with high turnover, even before the pandemic. The leisure and hospitality sector has recorded the highest quit rates across all industries, with the accommodation and food services subsector consistently reporting quit rates at or above 4% since July 2022.
Across all sectors, hiring rates have consistently surpassed quit rates. For instance, while the leisure and hospitality industry lost 781,000 employees in January 2024, it simultaneously welcomed 1.05 million new hires. Since November 2020, this industry has experienced the highest hiring rates of any sector, fluctuating between 6% and nearly 19%, far exceeding the national average of approximately 3.7% since January 2024.
When assessing the labor shortage by industry, the education and health services sectors, alongside professional and business services, consistently display the highest volume of job openings. It’s important to note that professional and business services encompass a wide array of occupations, including legal services, scientific research, landscaping, cleaning, and waste disposal.
In contrast, more stable and higher-paying industries, such as financial services and manufacturing, have reported lower rates of employee resignations.
As the labor market continues to evolve, understanding these dynamics is crucial for businesses and policymakers aiming to address the ongoing workforce challenges in America.
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