According to the most recent data from the United States “Job Openings and Labor Turnover” (JOLTS) report, 4.4 million Americans left their jobs in September. For only one month, this is an enormous amount of people either quitting their job or switching to a new opportunity.
The U.S. has 10.4 million job openings, surpassing pre-pandemic levels. In November 2019, there were 6.8 million job openings. Over the 12 months, ending in September 2021, new hires grew to 73.3 million and separations totaled 67.7 million, leaving a net gain of 5.6 million.
Quits are defined as voluntary separations initiated by the employee. Therefore, the quits rate serves as a measure of a worker’s ability to leave a job, confident that they could secure a new one. Total separations include quits, layoffs and discharges and other separations.
Hires include all additions to the payroll during the entire reference month, including newly hired and rehired employees. This also includes full-time and part-time employees, permanent, short-term and seasonal employees, among other instances.
Quits are up the most in sectors where most work is done in-person and those earning relatively low pay. Quits increased in several industries with the largest increases in arts, entertainment and recreation. Other separations increased in finance, insurance and state and local government education.
There is a confluence of events that is causing both the increase in job creation and people quitting. Once the economy started reopening, confidence returned. People felt more comfortable leaving the safe confines of their homes and venturing out into the world. They attended concerts and sporting events. People started traveling again. Instead of ordering in food, families ate out at restaurants.
During the pandemic, millions of Americans were fired or furloughed. With the renewed awakening, businesses of all kinds needed to scramble to find workers. The folks that were previously let go are now in high demand and fought over.
Add to the equation that the virus outbreak—and the devastation it wrought—made many people reevaluate their lives, jobs and careers. Many people realized that they don’t want to continue in the same old job. They wanted to pivot to a new job or reinvent themselves by pursuing different interests.
Tired of the stress of the pandemic, annoyed by irritating bosses, frustrated by low wages and lack of future growth, workers decided that they’d quit—even if another job wasn’t lined up. It was important to their mental health and emotional well-being to extricate themselves from a toxic, dead-end job. Fortunately, in a hot job market, there are enough opportunities available that people don’t have to worry about finding a new job.
There are other reasons why people quit. Working mothers had the challenge of juggling their jobs and also finding childcare. Unfortunately, unable to procure any or reasonably priced childcare options, they temporarily left the workforce. Workers who had to regularly interface with customers were concerned about contracting and spreading the virus, electing to quit and find a different and safer type of job. Warehouse, fulfillment centers and manufacturing saw staff leave, as demand surged and supply chains disrupted, causing workers to feel overwhelmed.
Businesses have been forced to make themselves more attractive to job seekers. They’ve offered sign-on bonuses, higher wages, upskilling, free college tuition and flexible work schedules.
The Great Resignation and a war for talent is likely to continue for the foreseeable future, as the economy is growing and jobs are plentiful. If you are tempted to join the ranks of the “quitters,” my advice is to give it considerable thought before you make the leap. In the moment, it feels good to contemplate telling off your boss and storming out the door. In some hot sectors, such as restaurants and bars, you could probably find a new job quickly.
For white-collar professionals, it’s not so easy. The average interview length can last three to over six months, and interviews are scheduled with five to 10 people. It’s a grueling process. If you resign without another job offer in hand, there could be adverse repercussions. For instance, when you interview, the hiring personnel will be skeptical about your judgement and may feel that you made an impulsive decision or think there is more to the story, such as you did something wrong or were politely told to leave.
There are more than 57.3 million Americans working in the gig economy, according to Statista. I’ve noticed an interesting aspect of the JOLTS report that hasn’t been talked about. Buried deep in the notes of the JOLTS report was this fact about new hires: “excluded are transfers or promotions within the reporting location, employees returning from strike, employees of temporary help agencies, employee leasing companies, outside contractors or consultants.”
If I understand this correctly, there could potentially be tens of thousands or even millions of workers who are left out of the government’s data, as they are not considered “employed,” by their standard, even though they are working and receiving monetary compensation.
If the gig workers are all included, the employment rate would be significantly higher, indicating an extremely strong economy. This would also account for one of the reasons why we are seeing a high level of inflation, as wages are being driven up by businesses battling to attract and retain workers.
Source: Forbes
