Two Years After Economic Shock, Some Sectors Still Can’t Fill Vacancies as U.S. Surpasses 11.5 Million Open Jobs

Overall Vacancies Nearing Double Pre-Pandemic Levels

On the last business day of March 2022, the job vacancy rate was 7.1% and the number of job openings was at 11.5 million, a historical peak, the BLS said in its most recent Job Openings and Labor Turnover report, published in May. Quits were also at a historical high of 4.5 million in March, with a “quits rate” of 3%.

Contrast that with the same BLS report from two years earlier.

On the last business day of March 2020, the number of job openings declined by 813,000 to 6.2 million vacancies, giving us a vacancy rate of 3.9%. Meanwhile, the number of quits dropped by 654,000 to 2.8 million. Workers that had jobs wanted to hold onto them, giving us a quits rate of 1.8%, the first report says.

The headline numbers — 11.5 million unfilled jobs as of this March, compared to 6.2 million open jobs two years prior — show an increase in the number of vacancies of 185%.

But there’s more to it than just those numbers. We can also see that in 2020, overall job openings were declining in March compared to February, whereas in March 2022 vacancies are up 200,000 from the previous month. The trend lines from the two years are going in opposite directions. However, it’s as yet unclear if current vacancies will continue to increase under present economic headwinds, such as record-high inflation and geopolitical instability.

It’s the same case with the quits rate, which is seen as a measure of workers’ confidence in the economy, and specifically the hiring environment. Fewer people were quitting two years ago, and the rate was on the way down compared to the month prior. According to the BLS, 1.7 million more people quit their job this March compared to two years ago.

Vacancy Rates Remain High in All Private Sector Industries

As the graph above shows, vacancy rates remain very high in all private sector industries, according to the BLS. Average private sector vacancy rates across the private sector were 3.9% in March 2020, and 7.5% in March 2022.

Industries With the Most Ground to Make Up

Above, we looked at the job vacancies in particular sectors to show how broad the issue of hiring is. Here, we’ll focus on the industries that may not have the highest vacancies right now, but that show the widest gaps between their pre-pandemic and present vacancy rates and levels. Just the fact that all of the numbers are positive means that every industry has a higher vacancy rate now than two years ago.

Leisure and Hospitality

The leisure and hospitality industry was one of the first casualties of the lockdowns and border closures that began in March 2020

BLS data shows that just over one million job “separations” in the leisure and hospitality industry in the March before the pandemic, then leaped five-fold in March 2020 to just under 5.5 million layoffs, firings, and quits.

Although both manufacturing and education and health care saw their number of separations double between March 2019 and March 2020, both industries combined couldn’t match the carnage in the leisure and hospitality industry.

With a 5.8-percentage point increase in its vacancy rate since March 2020, the leisure and hospitality industry remains the sector with most ground to gain if it’s to close the yawning gap between a current vacancy rate approaching 10% and its pre-pandemic rate of under 4%.

Like many of the sectors that the BLS splits the economy into, there are also ssubsectors that may fare worse or better than the overall industry it belongs to. In this case, leisure and hospitality is split into arts and entertainment, and accommodation and food services.

The high vacancies in entertainment suggest that, depending on the region, specific job requirements, and an individual’s experience, there may be openings for those who graduate with degrees in the fields of visual or performing arts, or even stage management, cinematography, sound design, and other behind-the-scenes roles.

That being said, this study doesn’t look at the salaries for these 216,000 open positions, so it’s hard to say that things are better for artists and entertainers now than before the pandemic. Like all of the vacancies we speak about, those jobs may be open for the simple reason that they aren’t paying enough.

Though arts and entertainment still has a very high vacancy rate, it’s the accommodation and food services part of this sector that took the biggest losses, and has the farthest to go to return to “normal.” This is a subsector that was hit hard by the sharp slowdown in dining and travel in the first year of the pandemic.

Now that demand for vacations, dining, and nightlife is returning, the industry is having trouble attracting employees to make up for those that were laid off or furloughed as a response to the pandemic. With 1,458,000 job openings, those with degrees in hospitality management or experience in restaurants and bars will have plenty of opportunities in this industry.

The question, as with all of these sectors, is if working conditions and pay has improved enough to draw workers back, or if these vacancy rates are an indication of workers leaving leisure and hospitality for jobs without the unpredictable hours and unimpressive wages.

Mining and Logging

Although it employs a fraction of the people employed in some of these other sectors, mining and logging had the second-highest gap between its vacancy rates in March 2020 and March 2022. That leaves the sector with 40,000 jobs to fill as of this March.

Lumber companies in particular slowed their activities at the beginning of the pandemic, anticipating decreased demand for their products and being wary of having to sit on piles of unwanted inventory. That was the case during the 2008-2009 recession, and few executives wanted a repeat of those years’ glut of supply, which would drive down lumber prices.

Counterintuitively, though, many households used savings or stimulus money to invest in improving their homes, keeping demand for lumber high. But at that point, loggers had already let go of many employees, and have since had trouble getting them back.

The silver lining is that forestry and natural resources management majors now have more choice over where and how they work, since so many companies in the mining and logging sector are hard-pressed to fill some of these less pleasant and more dangerous jobs.

Manufacturing

Manufacturing relies on many inputs from the mining and logging sector above, as well as more complex and often unavailable oreign-sourced parts, such as semiconductors or auto parts. This industry, along with the trade, transportation, and utilities sector we’ll discuss below, has been the victim of supply chain problems since the beginning of the pandemic. Anticipating a pandemic-induced economic contraction, manufacturers, among others, cut back on the inputs of production.

But with the help of federal stimulus programs, consumers wanted more of the finished products that manufacturers produce. Unfortunately, many manufacturers had let go of much of their workforce; like other industries, they’re now scrambling to get workers back on assembly lines.

Manufacturing of both durable and nondurable goods has a vacancy rate 4 percentage points higher than it had in March 2020. That means there are a total of 860,000 available manufacturing jobs as of this March. Degrees in industrial engineering, manufacturing engineering, and mechanical engineering are all pathways to this sector.

Education and Health Services

The broader education and health services sector had a vacancy rate 3.9 percentage points above its pre-pandemic level, leaving 2,256,000 open jobs on the market.

This was driven more by a rise in vacancies in the health care and social assistance subsector than education. While both have seen significant increases in vacancies during the pandemic so far, health care and social assistance has a March 2022 vacancy rate of 9%, putting the subsector just behind accommodation and food services in terms of vacancy rates. In absolute terms, that means 2,027,000 jobs remain open in health care and social assistance, and 204,000 in educational services.

A wide range of fields of study can lead to this sector, including a variety of degrees in education and healthcare. These could include special education teaching, subject matter specific education majors, or registered nursing degrees alongside other healthcare and allied services majors.

Other Industries With Challenges in Hiring

There are a number of other sectors that have had particular difficulties in the past two years, as the table above shows.

The trade, transportation, and utilities sector as a whole has 2,036,000 open jobs. But over half, 1,294,000, are in the retail trade subsector, which has a high vacancy rate of 7.5%. While the other subsectors also have hundreds of thousands of jobs available, wholesale trade and transportation, warehousing, and utilities are both less than 1.9 percentage points off their March 2020 vacancy rates.

This is another industry that has been affected by supply chain issues, especially in the transportation and warehousing area. Before the pandemic, the economy ran on an efficient “just-in-time” supply chain that moved inputs from storage to producers to retailers to consumers smoothly. But supply chains have been blocked and snarled around the world first by coronavirus-induced border controls, then by a lack of trucks and truckers, as well as backlogs of shipping containers at major ports and their surrounding warehouses.

Most recently, Texas’ slowdown of trade and transportation at the southern U.S. border has left produce retailers north of the border with huge batches of unusable fruits and vegetables.

Though the virus may have been the catalyst for many of these issues, policymakers are still struggling with the Gordian knot of overlapping supply chain problems slowing down the whole system of global production and consumption.

Those studying logistics and supply chain management will be particularly well positioned to pick up some of these jobs.