Is Inflation Correlated to Resignations?

In a recent report by ABC News, it has been recognized that the trend of people quitting their jobs has continued at record levels since the late fall of 2021. 4.4 million people quit their jobs in February of 2022, up from 4.3 million in January. The Department of Labor also notes that employers added about 678,000 jobs in February. 

All of this data shows a glut in the labor market. More people are quitting their jobs for higher-paying positions, holding out for work that they find more accommodating and suitable for their lifestyle, or are simply waiting to find a position they feel more passionate about. 

The paradigm shift in the balance of power from employer to employee is not a new subject, as we’ve covered The Great Resignation in detail across multiple blog posts. But now, this trend is being faulted as one of the primary contributors to growing inflation in the United States economy. 

Inflation for a New Generation 

Before the events of the global pandemic, a competitive labor market typically meant that the number of open job positions was slightly lower than the number of unemployed people. Now, that has been flipped; there are an average of 1.8 open job positions for each unemployed person. This power dynamic gives employees incredible strength to demand higher salaries and quit jobs searching for more ideal positions.

The increased opportunities for workers have led to employers offering higher wages to a smaller labor pool. Economists are concerned that dramatic wage increases in such a short period could keep inflation rates rising, and businesses have to pass the higher salaries onto consumers. As of early spring 2022, the tight labor market is not indicating it will be reversing anytime soon.

Businesses Need to Stay Competitive 

How can employers retain an edge over the competition in a red-hot labor market? It all begins with being upfront and candid about unique benefits, salary incentives, and work/lifestyle perks included with their open roles. 

When job seekers begin their search online, the opportunity to keep their attention is fleeting, so highly visible and optimized job posts detailing open positions are critical to attracting the talent that businesses compete for. Jobiak has worked for years to develop systems and platforms to help employers elevate their job data and create visibility for the most sought-after candidates across multiple industries. 

To learn more about Jobiak services, click the link.

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