Thread by @DianeSwonk

Job openings at the end of January ticked down a bit but remained e
elevated. There were 11.3m job openings after hitting revised record of 11.4m in December. The bulk of the weakness was in leisure and hospitality, which was hit by the Omicron wave.

The quit rate ticked down a bit to 2.8% from 3%. The private sector quit rate edged 3.3% in December to 3.1% in January. Again, it would be reasonable to see a modest slowdown in quit rates, given the Omicron wave. Recruiting was most affected by the surge in those out sick.

Quit rates tend to lead shifts in wages as measured by the employment cost index by about a quarter. Today’s data suggest that wage gains will remain strong as we move into the second quarter but could plateau. Much will depend on whether Omicron suppressed quits in Jan.

Our own surveys which my colleague @timglowa worked on revealed that a stunningly large number of people have already changed jobs and the ranks of those looking to change have fallen, but remains staggeringly high. There are significant pool of boomerangs as well.

Will let @timglowa elaborate on his findings. I was struck by how much exit interviews matter; talent is much more easily lured back when they are treated well and with respect upon their departure. That is an area too many firms botch and burn bridges unnecessarily.

Layoffs ticked up ever so slightly but remained near a record low - much of the increase in layoffs was in the manufacturing sector. Several vehicle plants and suppliers were forced to temporarily shut down in January due to chip shortages.

All in all, the labor market remained remarkable tight and resilient through the worst of the Omicron wave. That had caught the eye of the Federal Reserve as a potential problem for inflation at a time inflation was already running too hot for too long.