More American workers quit their jobs this May than in any previous month since 2001, according to the Labor Department.
The Job Openings and Labor Turnover Survey is a monthly measurement of how many U.S. workers leave their jobs, voluntarily or otherwise. It also includes data on unfilled jobs. The Labor Department says this measurement offers “a more complete picture of the U.S. labor market than by looking solely at the unemployment rate, a measure of the excess supply of labor.”
The most recent survey results were released earlier in July and paint a pretty rosy picture for workers.
The quits rate, which measures workers voluntarily leaving their jobs, ticked up to 2.4 percent from 2.3 percent for April. That’s the highest quits rate since 2001, and a sign that workers can leave their jobs for better opportunities.
The hope is that better pay will follow close behind.
“As the rising quits rate shows, more workers are striking out for better jobs or better-paying jobs, confident they’ll succeed,” writes Jeffry Bartash at CNBC. “If more workers do that, it could force companies to raise wages faster to retain their best employees or to attract new ones.”
Will Wages Rise?
The unemployment rate has hovered around a 17-year-low for months, but significant wage growth has yet to follow. The PayScale Index, which measures the change in wages for employed U.S. workers, showed that wages declined 0.9 percent from Q1 to Q2 2018. And, real wages — the buying power of workers’ pay with inflation taken into account — have declined 9.3 percent since 2006.
However, for individual workers, changing jobs is often the best way to raise pay. Many, if not most, employers expect candidates to negotiate salary when they take a new job. Meanwhile, typical pay increases hover around 3 percent for workers who stay put.
“Workers can hope to get the best bump in wages when they switch jobs,” said Sophia Koropeckyj, a senior economist at Moody’s Analytics, in an interview with Reuters. “As workers seek to improve their lot by taking better positions they open up positions for others to climb up as well.”
In a hot job market, it’s no wonder that more workers are willing to take a risk on a new job.
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