American Workers Are Quitting Their Jobs at Record Numbers
- The Labor Department’s JOLTS report shows that employment vacancies fell to 10.4 million in August, a drop of 659,000 from July’s 11.1 million.
- A record number of 4.3 million workers left their jobs in August 2021.
- Many employers, most notably restaurants, factories, and schools are having trouble retaining employees.
The Labor Department’s Job Openings and Labor Turnover Survey, or JOLTS, reports the number of job openings monthly, workers hired, and the number of workers separated from their job.
The JOLTS numbers for August 2021 were released on the Labor Department’s government website on Tuesday, October 12, 2021. The Labor Department categorizes separations to include quits, layoffs and discharges, and other separations. Quits are typically voluntary and initiated by the employee. Therefore, as stated by the Labor Department, “the quits rate can serve as a measure of workers’ willingness or ability to leave jobs.”
Why Workers Are Leaving
According to the report, the number of quits increased to 4.3 million in August. The quits rate also increased to 2.9 percent. Specifically, quits increased in accommodation and food services by 157,000, while wholesale trade saw an increase of 26,000 quits. In addition, state and local government education saw an increase of 25,000 resignations.
The report shows that the number and rate of layoffs and discharges changed only 0.9 percent. However, the number of other separations increased in August to 390,000, an increase of 49,000 more than the month before.
Almost 7 percent of workers in accommodations and food services quit their jobs in August. These workers include servers, hospitality workers, waiters, and more.
Due to the financial assistance that Covid-19 prompted workers to receive, such as the stimulus checks, rent moratorium, and federal student-loan payments pause and forgiveness, many have the financial ability to quit their jobs.
‘The Great Resignation,’ as many call it, has continued through the last couple of months, empowering many to resign from their jobs in search of something better. It is speculated that workers are leaving due to poor working conditions, low pay, or simply to pursue a more fulfilling career.
The Impact of People Quitting
For workers, ‘The Great Resignation’ seems to be paying off. According to the Federal Reserve Bank of Atlanta, wages for low-income workers have been increasing at the fastest pace since the Great Recession.
Fast food restaurants are being forced to increase their starting pay, as hiring has become difficult during the pandemic.
Image credit: White House Photo / Alamy Stock Photo
For employers, job openings have been hard to fill, as represented by the August JOLTS report. With employers unable to fill so many positions, employees are now experiencing bargaining power and newfound confidence to request more from their future employers.
Many workers are now searching for working conditions tailored to their needs and wants, such as working remotely and lucrative benefits such as matching 401(k)s, excellent health care benefits, and unlimited paid time off.
Be Prepared When Quitting
Being prepared when quitting is essential for your financial wellness. Emergency funds can help you stay afloat while searching for a new job. Emergency funds typically have 3-6 months of living expenses accessible to you in a savings account.
Recommended Read: Build Your Emergency Savings Fund
If you are resigning from your job without a new job opportunity lined up, you may benefit from having a fully-funded emergency fund. The fund will allow you to stay focused on your job search while also keeping the lifestyle you have now.
What are your thoughts on ‘The Great Resignation’ and the current American workforce? Does it influence your decision to stay or leave your job in any way? Comment below with your ideas.
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