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Despite the odds, the Great Resignation lives on

Person walks past a "Now Hiring" sign
A "Now Hiring" sign is displayed on a shopfront on August 5, 2022 in New York City. John Smith/VIEWpress/Getty Images

  • The Great Resignation isn't ending: 4.1 million Americans quit in September.
  • US job openings rose in September to 10.7 million after falling in August.
  • It's good news for workers, but maybe not for the possibility of a recession next year.
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Reports of the Great Resignation's death are greatly exaggerated.

That's according to the latest data release from the Bureau of Labor Statistics, which shows that Americans have no qualms about quitting their jobs. They're not getting fired in large numbers either, and employers are even more desperate to hire them.

In September, 2.7% of the workforce quit for the third month in a row. There were 4.1 million Americans who quit that month according to the Job Openings and Labor Turnover Survey from the BLS on Tuesday. That's just below the 4.2 million Americans who decided to throw in the towel in August.

"There's still lots of heat in this labor market, but it has cooled down a little bit from earlier this year, and especially particularly late last year," Nick Bunker, economic research director at Indeed Hiring Lab, told Insider.

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Julia Pollak, chief economist at ZipRecruiter, similarly told Insider that "the Great Resignation is far from over, but it is clearly sort of winding down."

According to Pollak, "the overall trend is back towards less turnover in the labor market, higher retention numbers." Basically, it's "businesses finding it a bit easier to hang on to their workers and feeling less pressure to do all kinds of crazy things to fill vacancies."

At the industry-level, the quit rate in construction slipped to 2.0% after two consecutive months at 2.7%. Quits in leisure and hospitality also dipped from 5.8% to 5.3%, showing that lower-wage workers aren't leaving at the highly elevated rates seen earlier this year.

Even so, quits still remained high across the board, showing that the Great Resignation hasn't been shaken by some of the alarm bells sounding across the economy.

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The quit rate for professional and business services, for instance, increased slightly by 0.2 percentage points to 3.2%. For the third month in a row, 3.7% of the retail trade workforce quit.

Employers are still eager to hire, and they don't want to let their workers go

After falling in August, job openings bounced back and then some. There were 10.7 million job openings in September according to Tuesday's release. That beat the median estimate of 10.0 million openings from economists surveyed by Bloomberg. There were about 1.9 job openings for every unemployed person in September.

While the number of openings remains historically high, it has trended down since the spring.

"I think that this report overall, despite this little rebound in job openings, shows that the labor market is cooling overall and sort of gradually getting back to normal," Pollak said, adding that the "openings figure is volatile."

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Looking at job openings alone, "it doesn't look like demand for workers is really slowing down much at all," Bunker said. "The temperature of the labor market is still really high and hasn't come down that much recently."

Openings increased in the healthcare and social assistance industry in September, with Pollak pointing out that healthcare saw a record high in openings.

The number of US hires in September decreased from August's figure; there were 6.1 million hires made in September. Layoffs also dipped, countering concerns about mass cuts in the wake of a potential downturn. In the information sector, which includes tech workers, the layoff rate fell from 1.3% to a meager 0.8%. So, even while news about tech layoffs dominated recession discourse, the number of workers getting cut actually fell in September.

One industry did see a notable uptick in layoffs: Construction. The layoff rate there rose from 1.6% to 2.3% in September. As new home building cooled off and Americans put their dreams of homeownership on hold, it seems like the construction workforce is being pared back too.

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"Layoffs are the dog that hasn't barked yet," Bunker said. "People have been concerned for understandable reasons that we start to see a big or noticeable increase in layoffs, but we continue to see a layoff rate that's below what we're seeing before the pandemic and below the lowest rate we saw prior to the pandemic." 

But while a lot of job openings might seem like a good thing for the economy, it could spell danger ahead. In an attempt to curb inflation, the Federal Reserve has been trying to cool down the gap between the number of jobs available and how many workers are for hire. September saw that chasm widen even further. 

"I imagine that Chair Powell and his colleagues are frustrated by this number," Bunker said.

The Fed is likely to step in and hike interest rates even further in response, potentially setting up another recession next year.

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"The high number of openings continues to underscore the huge divide between supply and demand for labor, contrary to what the Federal Reserve wants to see as it battles inflation," Mark Hamrick, senior economic analyst at Bankrate.com, said in a statement. "On the other hand, labor market strength bolsters job security, a positive for workers and those aspiring to work."

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