By Jay L. Zagorsky —The Conversation 5 minute Read
The latest figures came out on January 4, 2022, and showed that 4.5 million people voluntarily left their positions in November–an “all-time high,” according to the agency responsible for collecting the data. That’s 3% of the nonfarm workforce, which headlines also proclaimed a record level.
But is it?
Data on people quitting comes from the Bureau of Labor Statistics (BLS).
Each month, the bureau runs the Job Openings and Labor Turnover Survey, also known as JOLTS. The bureau interviews about 20,000 businesses and government agencies monthly, which it uses to estimate several aspects of the workforce, including the number of people who quit, retired, were hired, or were fired.
Since April 2021, the share of nonfarm workers who quit their jobs has been at some of the highest levels recorded by the bureau. In all, nearly 33 million people left their positions during this period, or over a fifth of the total U.S. workforce.
Certainly, that’s a lot of people. But a closer look at all the historical data we have can help put this in some perspective.
One issue is calling the current levels a “record.” The problem is the data only goes back a little over two decades, which means it’s certainly possible that the rate could have been higher at several points in the past. We just don’t know.
For example, during the dot-com bubble in the late 1990s and early 2000s, the U.S. economy was strong, which created many new jobs and opportunities for workers. These are typical precursors to more people quitting their current jobs in search of better pay and benefits. Given that the rate was 2.4% in January 2001–a month after the quits data begins–it’s not a stretch to imagine it may have been higher than the current level at some point in 2000 or earlier.
Because about a third of the U.S. workforce had manufacturing jobs in the late 1940s, this suggests the overall quit rate was likely higher back then.
Putting quits into perspective
A lot of stories have also focused on the absolute number of workers who quit their jobs, such as 4.5 million who quit in November—on a seasonally adjusted basis.
If quits for December 2021 are similar to November, I expect about 47 million people will have voluntarily left their jobs in all of 2021. That would mean about 33% of the total nonfarm workforce quit jobs last year.
Again, that seems like a lot, but a huge swath of the labor force does this every year. In 2019, for example, about 28% of the U.S. workforce quit.
So, is quitting higher than normal? For sure. But is it off the charts enough to earn the moniker of “great”? I don’t think so.
Not all sectors are seeing a wave of quitting
Workers also aren’t quitting in droves across all sectors of the economy. While quits are higher than usual in most industries, a few sectors are responsible for most of the turnover, with some lower than their recent peaks.
The highest quit rate is in accommodation and food services. About 6.9% of people working in hotels, motels, restaurants, and bars gave notice in November. While that’s the highest since 2000, voluntary turnover in this sector is usually on the high side–given the nature of the work–and has been above 5% many times over the past two decades.
November’s second-highest quit rate, at 4.4%, was retail trade, which includes workers in stores and shops. Combined, these two relatively low-wage industries accounted for one-third of all people who quit that month.
We can also see from the data that young people make up the biggest share of those switching jobs. Data from ADP, one of the largest payroll processors, breaks down turnover by age. But unlike the JOLTS data, ADP doesn’t learn why someone is no longer working at a company–whether they quit, were fired, or something else—so it can track only total turnover.
ADP’s most recent data shows high turnover is concentrated among 16-to-24-year-olds, with a turnover rate almost three times the national average.