‘Quit Rate’ in the U.S. remains high, could be fueling inflation

Published: Feb. 6, 2023 at 6:52 PM CST
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BIRMINGHAM, Ala. (WBRC) - If you’re thinking about finding a new job, you aren’t alone.

Americans are still quitting their jobs at a high rate.

So how is this impacting our economy?

The U.S. Quit Rate shows how many workers left their jobs either to move on to something else, or to do nothing at all.

And while that rate is down slightly from its peak in late 2021, it’s still relatively high compared to historic standards.

The Labor Department said nearly 4.2 million people left their jobs voluntarily in November of last year with most people leaving over money.

Experts said wage growth hasn’t kept pace with inflation forcing many to seek employment elsewhere and economist said these so-called “quitters” generally receive more pay when they switch jobs.

That’s due largely in part to a surge in demand for labor that started when businesses reopened after being closed because of the pandemic.

Many employers are paying more now to keep their workers, and some economists fear this “wage spiral” will fuel inflation.

“As folks have to pay more at the grocery store they need more money in their salary which as they do that then businesses have to raise their prices when they raise their prices right you can see this is where this wage spiral idea comes from,” explained Assistant Professor of Economics at UAB, Dr. Ben Meadows.

“The same point to see wage growth cooling might be this beautiful middle of the road that folks have called a soft landing basically where you use strong rate raises to cool off the economy without triggering a recession,” Dr. Meadows said.

Dr. Meadows added that it’s too soon to say how much this will impact the economy or whether we’ll see a recession, but he said there are hopeful signs that wage growth is cooling while job numbers are not, which he said could be good place for us to be.

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