The U.S. job market has been strong even though high-interest rates have made money tight. The unemployment rate hit 3.9 percent, which is a pretty low number.
At the same time, the U.S. Bureau of Labor Statistics says that the quit rate for January was 2.1%. The quit rate is the percentage of workers who voluntarily quit their job and shows whether people are ready to leave or stay at their job.
There were a lot of people quitting their jobs in Delaware, South Carolina, and Alaska, among other places.
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According to a study by WalletHub, Delaware had a 3 percent rate, South Carolina had a 2.99 percent rate, and Alaska, Kentucky, and Utah all had 2.8 percent rates in January.
In the same month, the lowest quit rates in the country were in Massachusetts and Michigan (1.5%) and New York (1.6%).
In a job market with many more openings than companies can fill, the general trend in quit rates shows that workers have a lot of options when it comes to looking for work.
As soon as the COVID-19 pandemic ended, companies were eager to hire, which gave workers confidence.
Victoria Prowse, an economics professor at Purdue University, said in a statement for the WalletHub study, “This made employers compete harder for a smaller workforce, giving workers more power to get jobs with better pay or other benefits over their current roles.”
In the past year, the number of resignations has gone down, but they are still high. There are a lot of people retiring these days, which may be one reason why dropout rates are high in some places.
Peter F. Orazem, a retired professor of economics at Iowa University, told WalletHub, “Some older workers thought they could quit because their 401Ks grew quickly in 2020-2021, they could self-select into unemployment benefits that were made more generous, and they thought they could afford it.” “Rising asset values (primarily housing) also made them wealthier.”
But since living costs have gone up, some of those workers may have changed their minds.
It’s especially true for people who left between the ages of 45 and 60, when their careers were at their best in terms of pay. They are paid for the skills that are unique to their company, and long-term employees who quit may not be able to get the same pay at a new job, Orazem said.
There may also be a rise in quits because Americans are changing how they think about work.
“People used to ‘live to work,’ now they ‘work to live,’ and now they ‘live only if work matters,'” said Matt Fuss, an associate professor of management and human resource management at Geneva College in Western Pennsylvania. “Younger people today must feel an emotional connection to their work and have been programmed to believe that every job must have a specific measurable effect on making the world a better place.”
Fuss thinks that these changes in attitude could stick around, especially in a job market that helps workers.
“I believe this shift in perspective, as well as radical change in the underlying philosophy of what work is, will cause the labor force issues to persist long-term,” he added. “People work for different reasons now, and the things that drive them have changed.” And I think this change will only get worse. Employers will have to deal with it for years to come.