With all the talk about inflation, stagflation, higher taxes and lack of affordable housing, I couldn’t help noticing one contrary statistic amid the sea of pessimism—the national “quit rate” is at an all-time high. The quit rate is the number of workers who voluntarily leave their jobs as opposed to being terminated, downsized or furloughed.
According to data released by the U.S. Bureau of Labor Statistics (BLS) last week, 4.3 million Americans quit their jobs in the most recent month measured. That means nearly 3% of the workforce—one in 33 workers—left their jobs voluntarily — the highest level ever reported by the BLS Job Openings and Labor Turnover Survey series. In fact, nearly 20 million U.S. workers have voluntarily resigned from their jobs since the spring, according to the latest federal data.
What’s giving workers the confidence to tell their bosses to “take this job and shove it” when so many economic storm clouds seem to be on the horizon?
Extended unemployment insurance, insufficient child-care options, eviction moratoriums and vaccine mandates area playing a role. But I suspect there’s something else at play. Everyone from fast food restaurants and hotels to high tech companies and accounting firms complains they can’t find enough workers to fill their open job positions—even with ever-rising wages.
Hmm.
As The Wall Street Journal reported last week, LinkedIn has seen a 20% jump in searches related to quitting compared with a year earlier. Hashtags such as #greatresignation, #newjob, #jobhunt and #burnout have accrued tens of thousands of followers on LinkedIn. A March analysis by Gallup found that nearly half (48%) of the U.S. working population surveyed was actively job searching or watching for opportunities. The survey included workers in every job category, from hourly consumer-facing roles to high-paid professional positions, who were job hunting at roughly the same rates.
But, it that enough to explain what economists call are calling the “Great Resignation”?
As Yahoo News columnist, Mike Bebernes, reported last weekend, many workers are simply burned-out. He believes the high quit rates in customer-facing jobs and health care suggest that people in these fields have become exhausted after 18 months of extra hours, confrontations over COVID mitigation rules and fear of catching the virus. Meanwhile, wrote Bebernes, “white-collar workers, are eager to maintain some of the elements of pandemic-era work that benefitted them — like remote work and flexible hours — and willing to move on as their employers transition back to the office.”
But I also think we’re seeing the residual effects of a consumer savings glut as Americans showed uncharacteristic restraint on their spending during the darkest days of the pandemic. That massive stockpile of excess cash means they have more of a cushion to absorb a job transition or temporary leave from the workforce. When workers see the excess cash in the bank accounts and start tallying up all the money saved by not going to work — childcare, dry-cleaning, commuting, deli lunches, etc. – staying home seems to make more and more sense.
The pandemic was like a forced sabbatical for many workers. It gave them time to do some deep soul searching about their whole relationship with work. “The human tragedy — and, in some cases, indifference from their employers — that workers have experienced over the past year and a half has led millions of people to deprioritize work in their lives,” Bebernes wrote.
“The big unanswered question about the Great Resignation is whether it’s a short-term phenomenon brought on by extreme circumstances or a more lasting shift in attitudes toward work?” Bebernes asked.
From where I sit, shift is not going to be “transitory.” Here’s a sampling of smart takes I’ve curated for you:
“We know that when human beings come into contact with death and illness in their lives, it causes them to take a step back and ask existential questions. Like, what gives me purpose and happiness in life, and does that match up with how I’m spending my [life] right now? So, in many cases, those reflections will lead to life pivots.” — Anthony Klotz, psychologist in Business Insider
“People have options. And because they have options, their demands and their interests and their tolerance for things that are not aligned with their values on how they want to live their lives, they’re going to leave and they’re going to look for it elsewhere.” — Tsedal Neeley, Harvard Business School professor, on PBS NewsHour
“For at least two generations, workers have been on their back heels. We are now seeing a labor market that is tight, and prospects are becoming increasingly clear that it’s going to remain tight. It’s now going to be a workers’ market, and they’re empowered. I think they are starting to flex their collective muscle.” — Mark Zandi, economist, in Time
“The Great Resignation is not a mad dash away from the office; it’s the culmination of a long march toward freedom. More than a decade ago, psychologists documented a generational shift in the centrality of work in our lives. Millennials were more interested in jobs that provided leisure time and vacation time than Gen Xers and baby boomers. They were less concerned about net worth than net freedom.” — Adam Grant, in Wall Street Journal
“There is no ‘labor shortage.’ There’s a child care shortage, a living-wage shortage, a hazard pay shortage, a paid sick leave shortage, and a healthcare shortage,” Robert Reich, UC Berkeley professor of public policy and former U.S. Secretary of Labor, tweeted last week. “Until these shortages are remedied, Americans won’t return to work anytime soon.”
What’s your take? I’d like to hear from you.
Whether you’re an employee, a business owner, a manager or a managing partner, it’s been a long time since the demand for labor has outstripped supply. Workers have never been in better position to find work that’s meaningful to them and to perform it wherever and whenever it suits them to. By 2025, nearly a quarter of the American work force (36 million workers), are expected to be remote.
What’s more, the Millennials and GenZ’ers who are replacing the 3 million retiring boomers every year are more inclined to work smarter not harder. They’re far less likely than boomers to put up with hour-long commutes, abusive bosses and co-workers and to perform demeaning office chores traditionally associated with “paying your dues.”
Conclusion
To compete for talent in today’s market, employers will have to do more to show workers what that they do matters, whether they’re flipping burgers or performing open heart surgery. It’s not just a problem you can throw money at, and since they’re not in the office, you’ll have to find better perks than a foosball table, casual Fridays and bring your pet to work day.
As with every crisis, innovation on the hiring front will eventually prevail. Just don’t make the mistake of thinking worker (or independent contractor) leverage is transitory.
“You better not try to stand in my way
As I’m a-walkin’ out the door
Take this job and shove it
I ain’t workin’ here no more.”
— Johnny Paycheck, Take this job and shove it
#hiring, #quitrate, #practicedevelopment
