Key Points:
- Despite concerns about the future, employers continued to hire at an elevated pace and workers left jobs at a rate higher than before the pandemic.
- Despite headlines about pullbacks at high-profile technology companies, in-person service industries, such as Leisure and Hospitality, are still powering ahead.
- Layoffs remained low with December being the 22st straight month with a layoffs rate below its pre-2020 nadir.
Many people voiced concerns about the future of the labor market as 2022 drew to a close, but lots of people weren’t acting concerned. The labor market moderated through the year, but employers and workers remained confident and optimistic. Companies were still hiring and posting job openings at elevated rates and workers were leaving jobs at a strong pace. The labor market has been and looks to be a solid foundation for US economic growth.
Layoffs continued to be subdued despite the wave of terminations at high-profile technology companies. The layoff rate did rise slightly, but it has now been below its pre-pandemic all-time low for 22 straight months. Some sectors are seeing higher layoff rates, but other sectors continue to hold onto their workers. The layoff rate in Retail Trade is more than a percentage point lower than it was in February 2020.
Workers are clearly confident about their prospects as they continue to quit their old jobs at high rates. The current quits rate is still almost 0.4 percentage points above its 2019 average, so workers continue to act with confidence. This reality is particularly true for in-person service sectors such as Leisure and Hospitality. The quits rate in that sector is still more than a percentage point higher than it was before the pandemic.
