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Job Seekers’ Market Brings Better Pay Amid The Great Resignation

Lynn Hulsey Springfield News-Sun, Ohio

WWR Article Summary (tl;dr) As Lynn Hulsey reports, "Workers are talking with their feet. In April nearly 4 million people, or 2.8% of all employees, voluntarily quit their jobs, the highest numbers since the U.S. Department of Labor began tracking what is called the "quits" rate in 2000."

Springfield

A record number of Americans are quitting their jobs, creating even more heat in a sizzling labor market where companies desperate to fill positions are raising pay, offering signing bonuses and dangling remote work options.

"It's a job seekers' market," said Garth McLean, Montgomery County's interim director of workforce development. "What we are seeing is that people are aware that the job market is good and they're going out to see how much their skills are going to bring them."

Workers are talking with their feet. In April nearly 4 million people, or 2.8% of all employees, voluntarily quit their jobs, the highest numbers since the U.S. Department of Labor began tracking what is called the "quits" rate in 2000.

"That's typically a sign of a really strong labor market. It's typically a sign that employees are feeling really confident that they can go out and find another job," said Andy Challenger, senior vice president at Challenger, Gray & Christmas Inc., a Chicago-based global outplacement and career transitioning firm.

"Most who are quitting do have something else lined up," Challenger said. Nearly 17.9 million U.S. workers voluntarily left jobs between January and May, according to the monthly labor department quits report.

What some dub the "Great Resignation" is occurring as businesses — particularly those with lower pay — struggle to fill positions in an economy gaining steam now that the COVID-19 vaccine is widely available.

"Ultimately employment is a balance of supply and demand. The power in this equation for a number of years has been on the side of the employer," said Jason Eckert, executive director of career services at the University of Dayton.

In the past, even when the economy was doing well, people seeking work typically outnumbered available job opportunities, he said.

"We are seeing a shifting in the balance of power where workers are gaining more power in this conversation," Eckert said. "As such we are seeing salaries increase, especially in terms of industries that paid close to the minimum wage."

After years of stagnating, average weekly earnings jumped 3.9% year-over-year in June, according to the U.S. Department of Labor. That's a full percentage point higher than the year-over-year rate in June 2019 before the pandemic hit.

"They're trying to figure out if they can make more money and because everyone is hiring, it's causing them to look at what opportunities are available," McLean said. "People are transitioning to higher paying jobs and they're seeing what their skills are worth right now."

Anthony Thomas, 46, of Beavercreek resigned from his job at an Urbana manufacturer last year so he could take his part-time taco food truck business to the next level. In February Thomas opened his Taco Street Co. in the Mall at Fairfield Commons and he plans a second location in Dayton this fall.

"I make better money as an entrepreneur than I do working the job. Plus I have the versatility to attend school functions and be more hands on with my kids," Thomas said. "This is the best thing I could have done in my life."

More quits than layoffs In May the monthly quits rate ticked down slightly, with 3.6 million workers, or 2.5%, voluntarily quitting. Still, May's quits are more than twice the combined total of the nearly 1.4 million workers who were laid off or otherwise involuntarily discharged and the 346,000 who left due to retirement, disability or death that month.

The industries with the highest quits rates in May were in accommodation and food services, where 5.7% of workers quit, and retail, which saw 4% of employees leave voluntarily.

People are changing jobs and careers in the wake of the pandemic for a variety of reasons, experts said. For some, their pre-pandemic jobs disappeared and either have not returned or now offer too few hours. Some people decided to boost their skills and qualifications in college or job training programs.

"The credentials that we are training for demand high wages. We are seeing people go to a livable wage from a non-livable wage," said McLean, who oversees the county's Workforce Innovation and Opportunity Act program that gives dislocated workers up to $15,000 to train for in-demand jobs.

Many people remained employed throughout the pandemic, but want a better job with more money or improved working conditions.

"There are a lot of people who have been contemplating changing jobs for a while," Eckert said.

"A pandemic is a pretty bad time to leave a stable position," he said. "And now that we are perceiving that we are slowly emerging out of this, I'm not surprised that a lot of workers are either resigning or job seeking with the intention of resigning."

'Want to go back to do something' Nationwide 22 million jobs were lost between February and April 2020 and there are still 6.8 million fewer jobs — including 278,300 fewer in Ohio — than before the pandemic hit, according to the labor department.

The unemployment rate is 5.9% in the U.S. and 5.2%in Ohio. The rate is 6.3% in the Dayton metropolitan area, which includes Miami, Montgomery and Greene counties.

But progress on the jobs front is real, with employers adding 850,000 workers in June. That's the most since August 2020 when nearly 1.6 million jobs were added as the nation reopened more fully after the pandemic shutdown that spring, according to federal data on non-farm payroll employment. But things took a sharp turn downward last fall as COVID-19 cases surged again, recovering only with this year's widespread availability of vaccines and a drop in case counts.

There are fears that the current economic recovery could begin to stall or the labor shortage worsen as the virus appears to be surging again among the nation's large number of unvaccinated people. That is particularly of concern in industries where workers have close contact with customers, like restaurant and retail, the ones suffering the most acute labor shortages.

McLean said many of the dislocated workers the county serves with its federally funded job training and career counseling program say they are looking for a job "that is meaningful to them, that connects them to the mission of the organization that they work for. People want to have substance in what they are doing."

"I had a 71-year-old come in to be trained to be a CDL driver because he wanted something to do," McLean said "We are seeing folks re-enter the job market. As the fear goes down from this pandemic, people are going to want to go back to do something."

Reevaluating lives The pandemic led to a lot of introspection that experts said is at play in the quits rate.

"It's not just pure confidence in the labor market. It's also that people have really reevaluated what they want over the last year and a half, and people are making those changes now," Challenger said.

"There is a lot of burnout that happened during COVID. A lot of people are leaving, maybe not to go to another opportunity but to to take time off out of the workforce," he said.

The issue of remote work is also at play as companies begin pulling workers back to the office.

"We see a lot of people leaving specifically because they want to maintain the flexibility and autonomy," Challenger said. "They don't want to go back to the office, so they are moving to companies that will offer them full-time remote working roles."

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