Slow labor market turnover continues as job openings fall and hires rise minimally

The labor market showed little sign of change in August, based on the latest Job Openings and Labor Turnover Survey (JOLTS) data published by the Bureau of Labor Statistics, which noted a small increase in hires, a decrease in job openings and layoffs, and relatively consistent quits.

“If we look back over the last year, employers have been in this low-hire, low-fire environment, and that’s reflected again in the data,” Daniel Zhao, Glassdoor’s chief economist, told HR Brew. Let’s take a closer look.

Diving into the data. Job openings fell to 7.1 million in August, declining by 256,000 from July. Professional business services and healthcare and social assistance both saw month over month declines in job postings exceeding 115,000. The hiring rate for small businesses with fewer than 10 employees, which make up the bulk of US employers, fell by 1.7% between July and August, while all other establishment sizes reported little to no change.

Total hires rose slightly to just under 5.2 million in August, increasing by 46,000 from the month prior. Hires led in professional business services, rising by 36,000 month over month, followed by nondurable goods manufacturing and state and local education. Hiring in information declined by 18,000 between July and August, and the hiring rate for that sector fell to 1.6%, its lowest rate since late 2023, according to Zhao. While one month of data about one industry isn’t enough to draw conclusions, that decline is “consistent with what we’ve been hearing from both traditional information, which includes media, and new information, which includes tech, that hiring has been very sluggish,” Zhao said.

Within total separations, turnover changed little or slowed further. Layoffs in August declined by 61,000, to 1.64 million total. Quits remained relatively unchanged, sitting at 3.1 million in August, the same as the month before. Voluntary departures increased in professional and business services, nondurable goods manufacturing, and private educational services, and declined the most in wholesale trade, state and local education, and healthcare and social assistance.

Zoom out. With few people quitting and few companies hiring, it should come as no surprise to HR leaders that workers are unhappy right now. When jobs are few and far between, workers will prioritize staying put over taking a risk on a new opportunity, Zhao told us. Employers that ignore their employees’ frustrations risk letting their resentment build up.

“In a hotter job market, there would be an outlet for that pent-up frustration where you could go find a better job on the open market,” Zhao said. “Right now, the slow hiring that we’re seeing means that there is no outlet for that frustration, and it just means that workers are stuck in place stewing on things that are frustrating them about their current jobs.”

Many HR leaders are currently stuck between a rock and a hard place, though. Economic uncertainty has some companies tightening their belts, including for hiring and total rewards budgets. Because of this many HR teams can’t leverage tried-and-true employee engagement boosters like internal promotions, raises, or new benefits investments.

Zhao said HR teams should try to understand their workers’ frustrations (whether via employee surveys, cluster reviews, or just word-of-mouth) and consider an outside-the-box approach to finding solutions. For example, he said if workers feel they don’t have opportunities for advancement, and the company doesn’t have the budget for internal promotions, HR teams can create pathways for lateral movement, giving employees exposure to new skills and growth even if their paychecks don’t change.

“Because HR organizations are working under constraints right now, it is going to require getting creative,” Zhao said.