Quitting to Win—Why Are So Many People Leaving Their Jobs?

Louisville, Kentucky, Dec. 15, 2021 (GLOBE NEWSWIRE) -- By Abby Hall Blanco and Frank Raymond, Bellarmine University 

“I quit.”

That’s the message that many workers in the United States are sending to their employers. According to the Bureau of Labor Statistics, a record 4.3 million Americans quit their jobs in August and another 4.4 million in September—almost 3 percent of the entire U.S. labor force per month.

Some industries are seeing more turnover than others during what economists are calling the “Great Resignation.” Leisure and hospitality, for instance, saw over 6 percent of workers (more than 970,000 employees) quit in August. Another 56,000 quit in September. More than 3 percent of workers in “professional and business services” quit, as did over 600,000 individuals employed in education and health services. 

Economists frequently analyze movements in the labor market. But the magnitude of these shifts is eyepopping. What is going on? We don’t have all the answers, but economics can frame our thinking.

Every decision we make allows us to gain something, monetary or non-monetary. In a similar way, every choice we make necessarily comes with a cost.

Whether a worker chooses to leave a job comes down to a simple question: Do the expected benefits exceed the costs? For example, how easy or difficult will it be to get a different job? Will a different job make them happier? Would switching jobs give them more family time?

The easiest way to explain the dramatic exodus of workers from their jobs is that the costs and benefits of quitting have changed. Some of those shifts are the result of the current labor market. Others may be due to structural changes brought about by the pandemic.

First, consider the labor market. It seems like everyone is hiring. Indeed, many businesses and industries are in desperate need of workers. To attract workers, many establishments are offering higher wages, more paid time off, education and other benefits.

If you can quit your job and find a new one with better pay and superior benefits, that could easily outweigh the costs of seeking a new job.

Other factors may also play a role. During the pandemic, many people were forced to work at home. Undoubtedly, some found they preferred this arrangement. If their current employer insists on a return to the office, they may seek more flexible alternatives. Others, who worked outside their homes in the time before vaccines were available and when personal protective equipment was in short supply, may now feel differently about their jobs. Positions that once appeared low risk (like working at a grocery store or restaurant) now don’t seem as safe. So, people look elsewhere.

The pandemic also made previously stable service-sector jobs look unreliable. Many people starting their careers seek jobs in this sector and stay for many reasons, including need for income, no immediate desire for additional education, and uncertainty about their career goals. But these jobs are often very difficult, and real wages in this sector have been flat for years. Forced to consider other options during pandemic shutdowns, many are finding that the future is more secure in other growth industries, or that a little more education could make a dramatic difference in income and future happiness.

Ultimately, quitting can allow people to move into jobs where they are happier and more productive.

This is not to say that quitting is always good. Healthcare workers, for example, have reported high levels of burnout because of the pandemic. Other workers are leaving the labor force completely due to lack of childcare or other support systems. Childcare employment is down by more than 126,000 jobs. With fewer choices and higher prices for the remaining ones, many parents are opting to stay home. This may have real long-term consequences, particularly for women, who are much more likely to assume childcare responsibilities.

What we’re seeing now won’t last forever. People will go back to work, just not necessarily where they used to. The service sector could be the last to recover, affecting restaurants, hotels, hospitals, nursing homes and other industries for some time to come. Ultimately, the speed with which childcare options return to normal may have the greatest impact on how quickly people are willing and able to get back to work.

It should come as no surprise that many workers throughout the country are making different choices nearly two years into the pandemic. COVID-19 changed many things—not just in the labor market, but in how people view the world. When it comes to leaving jobs, we may find that, despite what we’re often told, quitters really can win.


Dr. Abby Hall Blanco is an Associate Professor of Economics in the Rubel School of Business at Bellarmine University and a Research Fellow at the Pegasus Institute, both in Louisville, Kentucky. Dr. Frank Raymond is a Professor of Economics in the Rubel School and until recently was Interim Dean, Associate Dean and Director of the Bellarmine MBA Program. He also served as Chair of the Department of Finance and Economics for 12 years.


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