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The pandemic lockdowns are over; the spread of coronavirus has eased; and life has returned to normal. But scores of Americans are still quitting their jobs in what some labor market observers have called “Great Resignation.” They usually list it as one of the factors behind the persistent labor shortages that haunt the U.S. economy, which fuels higher wages and inflation.
But what is really making Americans quit their jobs? A recently published survey of 25,000 job seekers across the country conducted by JobList in the last three months finds that the main reason behind the great resignation is that workers are unhappy due to a deep dissatisfaction with previous employment situations.
“Some of the top reasons for workers quitting their jobs this year are unhappiness with how their employer treated them during the pandemic (19%), low pay or lack of benefits (17%), and lack of work-life balance (13%),” said the report. “On the positive side, many workers also report quitting to pursue a new career path (20%), reflecting how the pandemic created an opportunity for some to switch fields or level up to more appealing roles.”
Cheri Wheeler, Vice President and Senior Consultant at Kelly Benefits Strategies, thinks that the Great resignation isn’t about people quitting their jobs and dropping out of the labor market altogether. It’s instead driven by prospects for new jobs, with workers wanting higher pay and younger workers wanting a better work-life balance.
“It is no longer attractive to only offer healthcare, a 401K, and a competitive salary,” Wheeler said.
In addition to traditional retirement plans, employees are looking for wellness benefits, more child and elder support, and additional PTO to care for the family,” she told International Business Times in an email. “Moreover, nearly 8 in 10 workers want their employers to provide financial well-being benefits, student loan repayment programs, and other financial tools.”
But Joe Mull, the author of the forthcoming book “Employalty: How to Ignite Commitment and Keep Top Talent in the New Age of Work” (May 2023, Page Two publishing), questions the very existence of the Great Resignation in the first place. Mull thinks it’s a big myth, pointing to a record-low unemployment rate.
“There’s only been a handful of months in the last two decades where unemployment was lower than it is. The percentage of prime-age workers participating in the workforce is higher right now than it was ten years ago,” he told IBT. “Yes, a smattering of folks retired early or started their businesses, but it’s a minuscule number overall.”
Like Wheeler, Mull argues that Americans quit their jobs in search of better ones. Thus, what others call a Great Resignation, he calls it a Great Upgrade, which started a decade ago from burnout in the U.S. workplace.
“For some, that’s an upgrade in pay. For others, it’s an upgrade in commute, fulfillment, or appreciation, but across-the-board, what’s happening is an overall upgrade to some aspect of quality of life,” he added. “There’s a massive recalibration about how work fits into people’s lives. As a result, more employees than ever before are willing to pull the trigger on a job change to upgrade their quality of life.”
Still, the quest of Americans to change jobs cannot explain the precipitous decline of labor force participation rates, from 66.2% in 2008 to 62.2% last month, according to the Labor Department’s latest data.
Many other factors are also at play, like the retiring of the baby boomer generation, generous tax credits for children, which distort the labor force participation, and the rise of the “nomad class” of remote workers.
In light of changing nature of the U.S. workforce, the debate between the Great Resignation and the Great Update remains open
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