For now, the hirers are trumping the firers. Figures released on September 2nd show that American employers, excluding farms, added 315,000 workers to payrolls in August. The Jobs Openings and Labour Turnover Survey (jolts), released a few days earlier, shows there were 11.2m job openings in July. There were almost two vacancies for every unemployed person. The situation in Britain is similar. The Bank of England forecasts a bitter recession, but Britain has a near-record level of vacancies.

Why is that? Behind today’s labour paradox lies three factors. First, high churn in the labour market. Second is the post-pandemic shakeup in the labour market. And lastly, most businesses fighting day-to-day battles have limited bandwidth to deal with the new complexities of the labour market. The few that do may be able to secure a lasting advantage.

Start with high churn. The jobs market is in a state of perennial change. Economic theory treats firms as if they are the same and the economy as if it is a “representative firm” writ large. In reality, firms are very different. Some businesses expand, while others shrink—in booms and in busts. The change in employment captured by indicators such as the monthly non-farm payrolls is a net figure, the difference between job creation and job destruction by enterprises and between joiners and leavers at the level of workers. These flows are large in comparison with the change in employment. In July, payrolls rose by 0.5m, but around 6.4m began new jobs and 5.9m left their old ones

The jolts data capture the rate of worker flows in a single month. Over the course of a year, an even larger number of people move from job to job or from not working to working (and vice versa). A rule of thumb is that jobs flow at a slower rate than workers flow. In expansions the rate of job creation trumps jobs destruction. In recessions, job destruction is greater. But churn is remarkably high at all times. Some hiring firms are also firing firms. Walmart, the largest private employer in America, confirmed in August that jobs would go at its headquarters even as it was creating some new roles.

For other firms, though, a cyclical downturn is forcing a rethink. Planned layoffs at companies such as Shopify, Netflix and Robinhood are a correction to rapid hiring earlier. A lot of the historical cyclicality in hiring is down to high-growth startups and newish businesses, says John Haltiwanger of the University of Maryland. In booms providers of capital, whether venture-capital funds, banks or public-market investors, are willing to fund all sorts of enterprises. But in downturns, investors become averse to risk.