A bit more than a year into the covid-19 pandemic, management professor Anthony Klotz spoke to Bloomberg News and warned of a coming “Great Resignation.” For a time, it looked like an excellent call.
During the initial spread of covid, switching jobs was rare. But coming out of the pandemic, with employers and households still flush with cash, the job market recovered at a record pace. Better jobs (and better-paying jobs) were created, workers took those jobs, and the overall employment situation in the US improved.
As a result, the quits rate in the US, which is the percentage of employed people voluntarily leaving their jobs, rose to a record high in November 2021, according to a data series that started in December 2000. But it never got above 3%, which means the quits rate in fact wasn’t particularly great. According to research from the San Francisco Federal Reserve Bank, there have been six other episodes in the 20th century where workers switched jobs at similar rates.
Now the rate is even less great. As of April 2023, it has fallen to 2.4%, in line with the quits rate that existed in 2019.
The recent decline indicates that the labor market cooled on its own without a recession. And this is likely going to encourage Federal Reserve officials to pause their interest rate hikes in June.
Timeline of the so-called Great Resignation
2009 to 2019: The quits rate moves from a financial crisis era low of 1.2% to a pre-pandemic high of 2.4% in July 2019, proving that this trend started long before the pandemic.
May 2021: Business professor Anthony Klotz coins the term “Great Resignation.”
July 2021: Executives begin to repeat the term in earnings calls. Several executives refer to it as a “so-called Great Resignation” because they hadn’t yet seen it affecting their business.
September 2021: The US quits rate reaches an all-time-high of 3%.
More on quitting, from Quartz
Quitting: a crash course. Come for the brief history, stay for the classic clip of an epic resignation.
How to resign from a job you just started. Need to get out of a job you just started? Here’s how to do it without burning bridges.
The only reason more Americans haven’t quit their jobs is healthcare. Learn how universal healthcare would help US workers take more risks.