We apologize to country songwriter David Allan Coe, but the main theme of the 2021 job market is “Take this job and quit it.”
According to the Bureau of Labor Statistics, 4.3 million workers in the United States quit their jobs in September, the highest number in history, signaling a widespread public rethinking of employment and whether or not to start.
Why is the “I’m leaving here” movement such a hot trend in the workplace? The easiest way to raise your salary these days is to change jobs.
This unsuccessful career tactic is backed up by a review in my robust spreadsheet of detailed payroll statistics from the Federal Reserve Bank of Atlanta.
Job changes – those who change employers or job responsibilities, or move to another profession or industry – have on average increased wages by 5.4% per year in the three months ended September.
Now compare that to people who kept their jobs, whose salaries only increased 3.5%. Or the overall growth of wages in the United States by 4.2%.
This is the largest gap between switch promotions and stayers in 23 years. Talk about your incentive to quit smoking.
So perhaps the bosses should ask themselves if they are part of the problem.
Hunt for a raise
Workplace analysts, politicians and business leaders discussed the reasons for quitting smoking.
The factors suggested range from fear of contracting coronavirus at work to multiple choices and lack of childcare for younger employees. A seemingly counterintuitive tactic where bosses pay for a new person instead of giving existing staff more money should be part of the discussion.
Statistics show that employers became incredibly stingy with wage increases during and after the Great Recession.
Let’s take a look at the odd workplace statistics tracked by the Atlanta Federal Reserve: workers who didn’t get promoted at all. In the decade 2010, wages for 15% of the workforce remained unchanged. This was more than in the 2000s, when only 12.3% did not receive a salary increase.
Then came the economic instability caused by the pandemic, and, surprisingly, workers were again valuable: the “no increase” share fell to 13.4% by August.
We are witnessing a new chapter in the development of trade-offs between boss and employee.
Before the pandemic, career stability and workplace culture, rather than pay, seemed to be the most desirable qualities. Workers focused on higher wages were often forced to look for work, while bosses received their stable table tennis tables and gourmet coffee machines.
Today, it seems, it’s all about money. Let’s take a look at the different size of the financial carrot offered to those applying for a new job.
Between 1998 and 2007, the bubble-fueled boom years, those who changed jobs received a 4.9% boost, up from 4.1% for those who didn’t. That’s a 0.8 percentage point reason for changing jobs.
When these good times got worse – the Great Recession era from 2008 to 2012 – the influence of job changeers declined 3%, just ahead of 2.9% for stayers.
Then there was an economic boom in 2013-19, and the pay rise advantage returned for the switchers: a 3.3% rise versus 2.6% for long-distance runners – a 0.7 point gap.
And this rise in premiums only grew during the pandemic era: since March 2020, switches have increased by an average of 4.2% versus 3.2% – a point gap.
There is no single payment
So who makes the best raise?
This summer there are only two According to an analysis in my spreadsheet of 32 worker characteristics tracked by the Federal Reserve Bank of Atlanta using 12-month moving averages, labor market slices offered more growth than job changes.
You must be either among the youngest workers – ages 16 to 24, whose typical wages jumped 9.5% in a year – or among the lowest paid workers, who received a 4.8% increase.
Workers in difficult, entry-level, or low-paid jobs received almost the same wage increases as those who quit smoking. Pay in the leisure and hospitality industry increased by 3.9% over the year, while wages for workers without higher education and people with low qualifications increased by 3.8%.
And only two groups received smaller promotions than people who stayed with their employer. The highest paid workers received only 2.8% increases, while the oldest workers aged 55 and over received only 1.9%.
Bosses will learn that workers know how to download paychecks if you leave the ship, especially in low-paying jobs. And in 2021, it’s all about the salary.
Leaving is the new labor movement.
Jonathan Lansner is a business commentator for the Southern California News Group. You can reach him at [email protected]