The Big Quit Demands More and Has Surprisingly Little to Do with COVID

Blog / The Big Quit Demands More and Has Surprisingly Little to Do with COVID

November 2021 saw 4.5 million people in the U.S. quit their jobs, but that figure — an all-time high — was already the product of a steady, upward trend tracing back to at least June 2020, which is why causal correlations are commonly drawn between the Great Resignation and the COVID-19 pandemic. In fact, 2021 saw 47 million voluntary departures carve out a labor vacuum affecting almost all sectors.

However, the correlation between the Big Quit and the pandemic constitutes the biggest misunderstanding of the phenomenon. A long-term trend of job exits was already established before quarantine culture reached the U.S., which means COVID only catalyzed a pre-existing issue.

The Real Quit Trend

According to the Bureau of Labor Statistics, the number of workers voluntarily leaving jobs has been steadily escalating from 2009 to 2021 beginning at an exit rate of about 1.3% of the national workforce. In fact, the year of the quarantine was the first year in that span not to continue the uptrend, and Harvard Business Review has pointed out that 2020 saw about 0.4% fewer quits than it would’ve had to see in order to keep the average pace since 2009. Only about 2.1% left their jobs in 2020, less than the 2.35% quitting in 2019.

What this means is: workers didn’t start quitting in mass numbers during the pandemic; rather, they’d been quitting with increasing frequency until the pandemic beset the market. Resignations actually went up about 0.10% on average year over year from 2009 to 2019, and then the drop came in 2020 with COVID. This unequivocally disassociates the two phenomena in question.

The correlation was most likely made, however, due to 2021 resignations still exceeding the quit rate it should have had based on the 0.10% annual uptick rate even despite the dip in 2020. One meaningful correlation with this return to the trend as about 2.6% of all workers left their jobs may very well be the fact that child tax credits and stimulus checks relieved some of the uncertainty of 2020.

What Was 2021 About Then?

November 2021 represents a 20-year peak in the American quitting average, so of course, it had to be examined. Speculation has run rampant, of course, but a February survey of U.S. adults conducted by the Pew Research Center lends more insight into what’s made it remarkable. The analysis involved a massive cohort of 6,627 workers, none of them retirees; 965 of them confirmed that they’d left a job voluntarily within the previous year. Results were also weighted for education, ethnicity, gender, partisan affiliation and other demographic breakdowns.

More than three of every four who quit a job in 2021 but didn’t retire, now say they’re currently employed; 55% of them have full-time positions while 23% are part-time, and a third of them say it was “very easy” to find the new job whereas a fifth of them say it was difficult, if not very difficult.

The Pew study showed 63% of those who quit last year saying they left because of low comp, and an equal share of them also cited a lack of upward mobility opportunities. About 57% of survey respondents said they left for feeling disrespected at work, too. These were the top three factors to which respondents attributed their departures.

HBR found a preponderance of studies—like those of the Federal Reserve Bank of St. Louis, the National Bureau of Economic Research, and Pew—in agreement with each other that retirees do make up a significant segment of the departures. They appear to have opted for early retirement to prioritize family and other things, including escaping COVID risks. Many also retired, however, because stock trading activity supported those with investment portfolios while advantageous property values supported others.

Note that many of these contributing factors were already the case prior to 2021 like the sometimes arbitrary option to retire early, dissatisfaction with pay, lack of advancement opportunities, and certainly disrespect. Pre-existing reasons to quit only being actualized in 2021 suggest that at least some of those predicted to quit in 2020 yet didn’t were just waiting to see what the future held before leaving.

The Education Matrix

Education levels ended up being a consistent variable in the reasons workers cited for why they quit their previous jobs. For instance, of those who quit in 2021 and responded to the Pew survey, those without four-year degrees proved more likely than their collegiate graduate counterparts to point to the lack of flexibility in the hours they worked. About 49% of non-college graduates highlighted this problem as a reason they quit in contrast with 34% of college graduates saying the same. In fact, the same was said by both groups of not getting enough work hours with 35% of non-grads sharing this complaint and only 17% of grads co signing their grievance.

The Pew study also found 66% of four-year-plus grads earning more than they did in their previous jobs whereas only 51% of non-grads could say the same. Similarly, 63% of grads reported more advancement opportunities in their new positions as opposed to only 49% of non-grads saying the same. Less education also predictably correlated with earning less in the new job than in the previous one, though the same wasn’t true for benefits.

The Gender Gap Test

Among those who quit in 2021, men and women had largely similar comparisons to make between the old job and the new job, but unsurprisingly, they differed when it came to assessing the balance of work and family responsibilities. Less than half (48%) of women were able to say their new job made it any easier to balance the two worlds, yet about three in five men said it did.

Child care complications were cited by 48% of the survey takers who had at least one kid under age 18 in the house, and that metric was evenly split into the two categories of “major” and “minor” reasons why people quit; 24% cited it as a major reason and 24% as a minor reason. This means one of any two households with children saw at least one resignation.

But It’s Everywhere

The Organization for Economic Cooperation and Development reports the Big Quit has had comparable effects in parallel economies like those of Australia, Canada, Italy, Japan, New Zealand, Spain, Turkey, and the United Kingdom. Across the OECD’s 38 member states, which include the U.S., there are about 20 million fewer jobs compared to the pre-pandemic workforce.

The global picture differs considerably from the American outlook. Of those 20 million, 14 million are reportedly not even looking for work. January 2022 saw an addition of 100,000 workers in the U.K., for example, but it’s a drop in the bucket compared to the 1.3 million vacancies still left to be filled thereafter according to the British Office of National Statistics.

Interpretation

It’s also important to note that BLS reports unemployment in the U.S. from January 2009 to January 2017 ultimately dropping from 7.8% to 4.7%, ebb and flow notwithstanding. Throughout the following presidential term until the start of the pandemic, it continued to drop to 3.5%. The pandemic then drove unemployment up to its highest peak since the 1940s at 14.7% in April 2020.

This means that—with the exception of the onset of the pandemic in 2020—the quit rate has been steadily rising since the end of the Great Recession while unemployment has been vanishing. Resignations are not correlating with joblessness, and retirement only accounts for a meaningful spike when correlating the Big Quit with the pandemic.

One of the most consistently applicable descriptors of all the reasons cited for leaving jobs in 2021 is that workers are simply getting more “picky,” demanding more gain from the concept of gainful employment. This common denominator among resignations is only buttressed by the length of the trend, which also makes it reasonable to deduce that the trend will continue.

Workers want more.