The “Big Quit” is having a detrimental effect on employers as they scramble to fill jobs and keep businesses running successfully. This record number of Americans quitting their jobs is part of a phenomenon nicknamed the “Great Resignation.”
In November 2021, the Labor Department released a report stating that about three percent of the current workforce had quit their jobs. Three percent might not sound very significant, but the actual number of individuals who left their employment totaled 4.5 million. This number surpassed the previous record, which took place in September, just two months previous. This record was 4.4 million. The number dipped only slightly in October, when 4.2 million walked away from current employment. Prior to the pandemic, the number averaged about 3.6 million in a record month.
The number of job openings for the same about of time fell to 10.6 million. This information does not account for the emergence of the Omicron variant and its effect on the economy (including the job market).
The “Big Quit” and the “Great Resignation” are monikers that experts have given this massive movement which is not about simply leaving jobs, but leaving a job that likely pays lower wages or offers less in the way of benefits. No, the “Great Resignation” has to do with people leaving their current employment for opportunities to earn better wages as well better working conditions and possibly better working hours. Because workers are feeling more empowered and better poised to lobby for better working conditions, employers are ramping up hiring in order to offset the loss of multiple workers.
At the same time, workers may be earning higher wages, but the highest inflation in forty years is wiping out much of these income gains. The federal government reported that, when inflation is factored in, average hourly earnings are actually slashed by 0.4 percent from October to November. That calculation considers the hourly wage increase of 0.3 percent in November, but it also factors in the 0.8 rate of inflation of that same time period.
Most of the November resignations took place in the food service industry as well as in accommodations. Transportation, health care, and utilities also saw a great many individuals leaving their job for better opportunities. Social assistance jobs were also a sector that saw a great many resignations.
For the last six months, the number of available jobs has stayed at ten million or slightly more. Before February 2020, or “pre-pandemic” levels, the highest number of available jobs on record was 7.7 million.
Employers are having quite a difficult time hiring workers as the number of available jobs is about 4 million more (10.6 million) than the number of unemployed individuals (about 6.9 million). Individuals now have a choice of what jobs they want to apply for, and it is adversely affecting the labor market.
December numbers have yet to be released, but unemployment is expected to be down from 4.2 percent to 4.1 percent.
