‘Nice Resignation’ has put many employees within the driver’s seat

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It is a good time to quit your job. Just make sure you have someone else to go to.

The latest data from the ADP Workforce Vitality Report shows that the “Great Resignation” in today’s job market still pays off for those who leave their jobs for a new job.

Third-quarter wage growth for all industries was 3.3% – barely a step with higher inflation (5.4% for the period, according to the US Department of Commerce) – but for job changers it was 6.6%. This compares with a growth of 4.8% for employees who remained in their jobs and only 2.5% for new entrants to the labor market.

Switching the itch was more lucrative for some than for others.

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“It depends on what area you work in,” said ADP chief economist Nela Richardson. “It pays off in sectors like finance and technology.

“There was a labor shortage in these areas before the pandemic, and two years later there is even more demand for people with these skills.”

The situation is different in the leisure and hotel industries, which have recovered from the pandemic. While job changers in the information and professional and business services sectors increased their wages by 10.5% and 10.6%, respectively, those in the leisure and hospitality industries earned only 0.4% more than in the same period last year.

The coronavirus pandemic has taken the job market through the glass and produced what Moody’s economist Mark Zandi calls an Alice in Wonderland job market.

“The workers are back in the driver’s seat for the first time in 30 years,” said Zandi. “The tense job market before [Covid-19 began] signaled change, but the pandemic pushed it forward faster. “

A combination of record high job openings – 11.1 million in July and 10.4 million in August – and a record dropout rate of 2.9% in August (4.3 million jobs) is indeed unearthly. The unusual circumstances resulted in a very poor job report in September with much fewer than expected 194,000 new jobs a month, according to statistics from the US Bureau of Labor.

For the first time in a long time, many workers have the option of demanding higher wages, better benefits and / or more flexible working conditions from new or current employers. But it won’t last forever.

As the delta variant of Covid-19 declines and the number of vaccinations increases, the market dynamics will change, suspects Zandi.

“With a record number of vacancies, people are more comfortable quitting their jobs,” he said. “The window for a change is still wide open, but it will close.”

Zandi assumes that the economy and labor market will normalize again in the next 12 to 18 months, “provided the pandemic continues”.

For job seekers, cash is king. Wages are still the most important issue.

Nick Bunker

Director of Economic Research in North America for Indeed Hiring Lab

Nick Bunker, North America director of economic research at Indeed Hiring Lab, also expects significant job gains over the next year as Covid concerns ease and the unemployed ‘s financial cushions begin to wane.

The expanded unemployment benefits introduced at the beginning of the pandemic ended in early September for most Americans.

What American workers are looking for most in their jobs is higher pay is still the number one priority.

“For job seekers, cash is king,” Bunker said, noting that searches for companies like Amazon, Chipotle and Bank of America on Indeed’s job board network exploded after announcing an increase in the minimum wage they were paying. “Wages are still the most important issue.”

Whatever your reasons for looking for a new job, Bunker has two pieces of advice.

“Before you quit your old one, get your new job and talk to your employer about the changes you want,” he said. “You can get what you want in your current job.”

ADP’s Richardson believes we are only just beginning to understand how the pandemic is changing the world of work. Digital transformations, more flexible work regulations and a better work-life balance are part of the picture today.

She said there was a lot more to the work decision than it was two years ago.

“There is a re-evaluation of workers wondering whether their job is worth what they make and employers who can only raise wages that much,” said Richardson. “That will be the next conversation.”

Correction: In an earlier version of this story, the name of the ADP Workforce Vitality Report was incorrectly stated.

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