Everyone is quitting their jobs

Published 06/28/2021
 
Jordan Weissman, Moneybox
 
After three years slinging crunchwraps, young Steven Pauley of West Virginia apparently quit his job in order to pursue the Zoomer dream of playing video games full time on Twitch. To commemorate the end of his fast-food career, he stood up on a little ladder in the kitchen, braced himself, then leaped into the giant, soap-filled tub. The water explodes like a depth charge has just gone off, and he emerges covered in suds, somehow having avoided fracturing his tailbone, like a legend.
 
Though not everyone is exiting with a literal splash, Steve’s goofy little stunt pretty much sums up America’s mood at a moment when workers are bailing on their jobs like never before. In April, nearly 4 million workers bid goodbye to their employer, pushing the quit rate to a record high since the government began tracking it about two decades ago. Telling your boss so long was definitely this spring’s hottest career trend.
 
When lots of workers are quitting, it is usually considered a sign that the economy is doing well, since people typically aren’t willing to leave one job unless they are pretty confident that they can find another. Right now, things are slightly more complicated. With the coronavirus crisis fading and customers flocking back, businesses have been desperate to hire—job openings are hitting new records. But while millions of Americans remain unemployed, they’ve been slow to return to the workforce, either because people are choosing to ride out generous jobless benefits for a while longer, have family obligations at home to tend to, or are just being choosy about their next career move.
 
That’s created a red-hot market for job hunters, one in which McDonald’s workers can get a raise by going to the competing franchise down the street or, if they want to, leave behind service-industry drudgery altogether. The quit rate is by far highest right now in low-paid, high-turnover industries like retail and hospitality, where many workers are burnt out after slogging through the pandemic in working conditions that may have put their personal health at risk. As one former pet store worker told the Washington Post, “My life isn’t worth a dead-end job.” At the same time, white-collar workers are feeling empowered too; quits are up in professional services, and a survey by Morning Consult found that 39 percent of employees said they’d consider leaving their jobs rather than give up remote work. In March, around a quarter of all workers told the pollster they were considering switching employers.
 
It likely helps that by staying in and collecting stimulus checks, Americans saved an enormous amount of money during the pandemic, giving them the breathing room to leave their job without a replacement lined up immediately. The extra financial cushion is probably giving some people the courage to try entrepreneurship out (the startup rate for new businesses shot up during the crisis and has stayed high into the past few months) or pursue a fun lark, like becoming a professional video game streamer. Personally, I’ve got a buddy who’s thinking of leaving a decent media job to hike the Pacific Crest Trail. You know workers are in a good spot when people are seriously thinking about giving up jobs in journalism, an industry that has been in a state of unrelenting decline for years.
 
Some of this dramatic rise in quits might also be a temporary blip, caused by a backlog of people who would have left their jobs last year but didn’t because of the pandemic. But in the end, the main factor is probably just that lots and lots of businesses are hiring. As Harvard economist Jason Furman noted to me, the quit rate is roughly in line with what you would predict based on the number of job openings. (In hospitality and business and professional services, it’s actually slightly lower.) That suggests the number isn’t being driven primarily by delayed departures or workers experiencing personal epiphanies about what they would prefer to do with their lives, but simply the volume of new opportunities.
 
But regardless of the exact reason why, people seem to treating the reopening era as moment of professional liberation. And you know what? It’s nice. One miserable aspect of life in the aftermath of the Great Recession was the constant, low-grade fear that if you lost your job, you might not be able to find another one. People tended to cling to their work, which created office cultures of people who were happy just to be there. Not coincidentally, the rate at which people quit their jobs tended to be quite low. When economists talk about the value of tight labor markets and full employment, they tend to emphasize the concrete, material benefits for workers, especially rising wages. (Pay in the leisure and hospitality industry has shot up.)
 
The present economy is currently biased in favor of workers looking for work rather than employers looking for them. How long this dynamic will be in charge is unclear, but at present, workers hold the winning hand.
 
That's why, in the new paradigm, you need an experienced partner like ASN to help guide you through the shifting sands that is the new marketplace. If you need help, please give us a call. We would love to talk with you.