A record 4.3 million workers quit their jobs
in August because of unemployment benefits and vaccine mandates
10/14/2021 / By Arsenio Toledo
A record 4.3 million workers quit their jobs in August, according to data from the Department of Labor. This wave of mass resignations is caused by expanded unemployment benefits and Wuhan coronavirus (COVID-19) vaccine mandates. Small businesses are expected to bear the brunt of the damage caused by this difficult situation.
According to the Bureau of Labor Statistics, which compiled
the data, the quit rate for August jumped to 2.9 percent. This translates to an extra 242,000
workers quitting their jobs. That month’s quit rate is the highest in the bureau’s data series, which
goes all the way back to Dec. 2020.
The quit rate for the previous month was 2.7 percent, which suggests
that more and more people are leaving their jobs.
According to the data, around 892,000 of the workers who quit come
from the foodservice and accommodation industries. This is followed by 721,000
workers in the retail industry and then by 534,000 workers in healthcare and
social assistance.
So-called experts on issues regarding labor and the economy claim that
the massive amount of people quitting is a sign that the economy is doing well.
“This really elevated rate of people quitting their job is a sign that
workers have lots of confidence and they have relatively stronger bargaining
positions than they’ve had in the past,” says Nick Burner, an economist working
for employment website Indeed.
“There’s a lot of demand, and people are seizing that opportunity and
quitting their jobs,” he adds.
People don’t want to work because of welfare
The reality on the ground is very different. Investment banker, business
analyst and commentator Chris Markowski says the record number of people
quitting in a month can be attributed to the expanded benefits
being paid to unemployed people.
“Nobody wants to work, it’s everywhere,” says Markowski. “No one has any
workers. The government basically started universal basic income when they send
child care tax to individuals.”
Eric Groves, CEO and co-founder of small business networking and
resource website Alignable, says many business owners have willingly accepted
that their profit margins are going to shrink for the next few months.
Many businesses in all industries have had to raise pay and spend more
on supplies and other raw materials. But the problem is many are still
struggling to find workers.
“Wherever labor is the critical element to revenue, it’s a challenge,”
says Groves. “The problem is when you’re short-staffed you’ve got to give your
staff a break so you can deliver the level of service you want.”
A recent survey conducted by the National Federation of Independent
Business (NFIB), America’s largest small business association, found that a
record 51 percent of small businesses in the country are unable to fill their
vacancies.
“It’s an incredibly difficult time for those who have open positions to
find and attract applicants,” says Holly Wade, executive director of the NFIB’s
research arm. “For many of them, they’re not receiving any applications – there
are just no resumes coming in right now.”
This lack of applications is occurring even though a record 42 percent
of small businesses have increased their starting pay and 30 percent say they
plan to pay new workers more within the next three months.
Vaccine mandates force people out of work
To add to the strain many businesses are already experiencing, the
federal government’s COVID-19 vaccine mandates are also forcing a lot of
workers out of their jobs, either through getting fired for not being
vaccinated or voluntary resignations.
“We are already in an unprecedented labor market right now, and this
mandate on private employers adds insult to injury because companies are
already facing severe labor shortages,” says Rachel Greszler, a research fellow
for conservative think tank the Heritage Foundation. (Related: New York hospitals
prepare for staffing crisis as vaccination mandate takes effect… thousands of
health care workers will now be fired.)
If nothing changes, Wade says the labor shortage will most likely keep
hampering America’s economic recovery.
“I don’t see that this issue eases any time soon,” she says. “Small
business owners are planning to have to deal with this well into 2022.”
Learn more about how many small businesses are going to collapse due to
the labor shortage by reading the latest articles at MarketCrash.news.
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