If anything made 2021 more memorable, apart from the Covid-19 pandemic, it is the Great Resignation. A term that refers to the mass job quitting witnessed during the year.
In August, 4.3 million Americans quit their jobs, and this number is outnumbering the previous high set in April when approximately 4 million people resigned from their positions. That figure increased to 4.4 million in September, a +164,000 increase from August. People quit at a 3.0 percent rate in September, up from 2.9 percent in August.
The number of people quitting their jobs in the United States reached a new high in November 2021, when 4.5 million people resigned. This is up from 4.2 million in October and extends a months-long historically high labor turnover trend.
Historically, resignation has been linked to workers’ confidence in their ability to find work elsewhere. This, combined with other psychological stressors such as financial concerns (inability to pay bills, mounting debt).
And though workers leaving the labor market are motivated by different factors, the resounding reason for most resignations is the increase in Covid-19 cases.
“Demand for workers, at least from the data on our platform, hasn’t dropped significantly because of the recent surge in cases,” said research director Nick Bunker of the Indeed Hiring Lab. “That could change fairly quickly, so it’s something we’ll be keeping an eye on.”
The mass resignation has outpaced job openings in the labor market, which has left many businesses struggling. According to Labor Department data, there were 10.6 million job openings at the end of November and 6.9 million unemployed people – 1.5 jobs for every unemployed person.
And they reported this month that employers added 199,000 jobs in December, the smallest monthly gain of the year. The slowdown began in November when 249,000 new jobs were added. The unemployment rate fell from 4.2 percent to 3.9 percent. Paired with strong wage growth — average hourly earnings increased 4.7 percent over the year, more than the 4.2 percent economists in a Bloomberg survey predicted — the rapid decline in the unemployment rate appears to indicate that a shortage of available workers is, in part, what is holding back hiring.