The figure below displays both the Vanguard hires rate and the JOLTS hires rate since 2003. (Both rates refer to new hires as a share of existing employees.) Both series show a pronounced drop in hiring during the 2008 global financial crisis and a surge in hires after COVID-19 restrictions were lifted, followed by a gradual return to pre-pandemic levels.
The JOLTS hires rate spiked to 6.1% in May 2020, likely reflecting the surge in rehires of many hourly service workers who were temporarily laid off during the COVID-19 lockdowns. That rate remained elevated through 2021 and has since declined to a low of 3.8% in June 2023.
The Vanguard hires rate based on 401(k) enrollments, which favors workers at larger firms, rose more gradually after the initial COVID lockdowns, peaking at 3.5% in March 2021. It has since declined to a low of 2.1% in July 2023.
“The recent moderation in hiring suggests that businesses have largely filled the employment gaps caused by the pandemic’s disruptions,” said Vanguard economist Adam Schickling. “We may be at an inflection point in the business cycle, where firms become more conscious of labor costs and employed workers become more hesitant to leave their jobs.”