- 4.3 million workers quit in December, according to the latest data release from the Bureau of Labor Statistics.
- It marks the ninth month of workers quitting at near-record rates, cementing a nearly year-long movement.
- Employers don't want to fire them, and workers are switching jobs, showing more worker power.
Over the last nine months, Americans have given birth to a new trend: Quitting their jobs.
In December 2021, 4.3 million workers left, according to the latest Job Openings and Labor Turnover Survey (JOLTS) release from the Bureau of Labor Statistics. That's 2.9% of the workforce. Previously, in November, a record 4.5 million workers left — following 4.2 million workers hanging up their hats in October. December's numbers mark the latest month of elevated quits since they first began soaring in April 2021.
But job openings crept up to 10.9 million, an unexpected increase; economists surveyed by Bloomberg projected openings to dip to 10.3 million. At the same time, the number of layoffs and discharges — basically, the people fired — reached a series low.
All told, it shows just how desperate employers were to staff up, even amidst the beginning of the Omicron wave. Workers still left en masse, and, while hires dipped a bit, they still remained robust. That meant that quitting workers weren't just sitting on the sidelines, but job switching instead.
In other words, December was another month where workers found themselves realizing the power of their labor — and taking it with them as they sought out better roles, or found themselves holding down ones that employers previously would have laid them off from.
"Layoffs are at record lows because employers are holding onto the workers that they do have amidst ongoing labor shortages," Daniel Zhao, a senior economist at Glassdoor, told Insider. "I think this is a reflection that employers recognize how difficult it is to hire workers right now, and so they're more willing to give a second chance to employees rather than try to replace them."
"Fewer layoffs mean workers have more security," Nick Bunker, economic research director at Indeed, said in an email to Insider. "In a labor market where employers are having a relatively difficult time filling positions and are seeing workers quit at historic rates, companies are holding onto the workers they can. Even if demand takes a short term hit, why lay workers off when hiring is unlikely to get much easier in the near future?"
It's yet another sign of a shift in the labor market, which seems to be swinging the pendulum of power more towards workers than employers. Anecdotal stories of labor shortages abound, but that seems to be more of a wage shortage, with workers continually leaving low-wage jobs at elevated rates.
The recent increase in worker power comes after years of decline. Wages in America have been stagnant for decades, while union membership remains low. The gains workers are seeing are still nominal, and some economists doubt they'll stick around without legislation and policy to back them up.
"We saw a historic job switching boom as workers seized new opportunities and many got higher wages as a result," Bunker said. "Whether this trend endures this year and job switching fuels continued robust wage growth is one of the key questions for the US labor market."
Economic Policy Institute's Elise Gould noted on Twitter that "the hires rate remains higher than the quits rate in every major industry. This indicates that when workers quit, they are taking other jobs-likely in the same sector-not dropping out of the labor force altogether."
—Elise Gould (@eliselgould) February 1, 2022
Recent research found that workers underestimate how much they could make elsewhere — but if they had a more accurate understanding of what they could make elsewhere, many low-wage jobs wouldn't be viable at their current wages.
"A positive legacy could be normalization of job switching," Zhao said. "More and more American workers realize that it is okay to switch jobs or ask for a raise when you have better opportunities on the table. I think that that is potentially the start of a paradigm shift in how workers think about their relationship with their employers."