The Great Resignation came, and now it appears to have gone. The US Bureau of Labor Statistics said Tuesday (Jan. 30) that 3.4 million people quit their jobs in December, way down from the 4.5 million who did so back in April 2022. The so-called “quits rate,” or the number of people quitting their jobs as a percentage of overall employment, fell to 2.2%.
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“The level of job openings, hires, and quits are much closer to pre-pandemic labor market conditions than in the height of the Great Reshuffling of 2021-2022,” wrote Elise Gould, senior economist at the Economic Policy Institute, in reaction to the data. “The faster churn at the height of the pandemic is behind us. The labor market is strong but not overheating.”
Less worker confidence means less inflation
Though the gap between number of job openings and quits is growing—there were 9 million availabilities in December, up two months in a row after a long skid—a lot of workers still feel wary about US economic prospects. People don’t like switching jobs as much when they’re skittish about the state of the world.
UK-based research group Capital Economics pointed especially to the service sector, where labor shortages were blamed for rising prices. For instance: The “accommodation and food services” quit rate, where turnover is typically very high, fell 0.7 percentage points, to 4.5%, in December.
“The bigger news was the sharp decline in the leisure and hospitality job openings rate to slightly below its average level in 2019,” wrote Andrew Hunter, the firm’s deputy chief US economist. “That is the sector where shortages were previously most acute and where labour market conditions probably have the most direct pass-through to inflation.”
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