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17/01/2022

Vast majority of American workers like their jobs – even as a record number quit them
A record share of American workers are quitting their jobs, thanks in part to a strong economy and a labor shortage.

Does that mean Americans are unhappy with where they work?

The answer would seem to be yes, according to many economists and other observers. That’s the narrative driving the Great Resignation, in which workers are simply fed up with their current jobs and demanding something better.

Survey data I’ve been collecting during the pandemic, along with social survey results from previous years, however, suggests this is far from the whole story. Rather than being motivated simply by dissatisfaction, it appears many of them are simply taking advantage of a strong economy to look around, while for others, the pandemic has prompted them to consider their options.

Are you satisfied?
The General Social Survey, a reputable national survey of American adults, has been asking workers questions about how they feel about the quality of their working life since 2002.

There are actually three key types of questions it asks that help us get at this idea: the level of dissatisfaction with current work, turnover intention and confidence in finding a new job.

Let’s start with dissatisfaction. The question is: “On the whole, how satisfied are you with the work you do – would you say you are very satisfied, moderately satisfied, a little dissatisfied or very dissatisfied?”

In 2002, about 12% of respondents said they were very dissatisfied or a little dissatisfied with their work, a figure that barely changed in subsequent surveys through 2018. In 2021, a tad over 16% said they weren’t satisfied – an increase, but not a big one. And on the flip side, a little over 83% said they were moderately or very satisfied.

This means that by and large the vast majority of Americans – at least according to this survey – express moderate to high satisfaction with their work.

Looking for a change
Turnover intention is another important indicator. The General Social Survey asks:

“Taking everything into consideration, how likely is it you will make a genuine effort to find a new job with another employer within the next year – would you say very likely, somewhat likely or not at all likely?”

My interpretation of a “very likely” response to this question is that it signals an immediate interest in leaving their present job. In 2002, about 19% said they were very likely to try to find a new job soon. Over the years, the share who said this rose and fell a little, but has remained very consistent.

Unfortunately, the survey hasn’t posed the question since 2018, so I partnered with polling company Angus Reid Global to conduct two large national surveys of American workers in November 2020 and November 2021. One of the questions I asked was the one on turnover intentions, though I extended the period of time in which they expected to look for a new job to two years.

As you might expect given the rising quit rate, the share saying they were very likely to hunt for a new position jumped. It rose to 26% in 2020 and to 29% in November 2021.

While it’s likely that my number is a bit elevated just because of the extended time horizon – two years instead of one – the increase is consistent with the Great Resignation narrative that workers are keen to find a better workplace.

But these two figures – job satisfaction and turnover – reveal an interesting paradox: A greater share of people say they are contemplating quitting than express dissatisfaction with their current job. There are several possibilities for why a worker might be happy with their job, yet eyeing a move to another company. Perhaps they’re seeking more status or reconsidering their career, or maybe they’re worried about possible layoffs.

Confidence in the job search
An additional theme in the Great Resignation narrative is that workers feel more confident about finding alternative job prospects – and that’s one reason they have been quitting in droves.

Fortunately, the General Social Survey asks that very question:

“How easy would it be for you to find a job with another employer with approximately the same income and fringe benefits as you now have – not at all easy, somewhat easy or very easy?”

Two years before the COVID-19 pandemic, in 2018, about a quarter of respondents said finding another job would be very easy. I asked the same question in my 2021 survey and found that number had actually decreased to around 22%.

This means that worker confidence or optimism about finding a palatable alternative job has not climbed all that much, making it less likely to be a factor in driving the current wave of resignations.

What’s going on here?
While the data doesn’t show that Americans overwhelmingly love their jobs or anything like that, they do suggest most people like them enough to hold on to them.

Of course, this isn’t the end of the story. The data does show important differences depending on the type of job we’re talking about. For example, workers in the service sector were more dissatisfied with their jobs and much more likely to express an intent to quit than the average respondent.

But all in all, the survey data doesn’t support the common narrative that it’s a “take this job and shove it” economy, in which increasingly unhappy workers are finally sticking it to their managers.

Rather, when you dig down into the data, something different appears: A slice of workers are always considering leaving their jobs – and as the labor market looks brighter, the pent-up impulse to quit kicks in. But the shift in worker sentiment – or at least the way it has been portrayed – seems exaggerated.

17/01/2022

‘Do what you love’ could be contributing to the Great Resignation
“Do what you love,” is no longer just advice.

High school students learn early on that their future careers should be passion-driven. Self-help books counsel job searchers to start with reflection on what they love. And Hollywood films teach people, in romantic fashion, to aspire to work that is intrinsically satisfying and expresses our authentic selves.

Researchers call this way of thinking about work the passion paradigm, and studies show it has become pervasive in modern societies.

The passion paradigm emerged in the 1960s. During this time, there was widespread questioning of social and cultural norms — especially among youth — which helped develop a new way of thinking about the role of work in human life.

This trend was spearheaded by the scholarship of humanistic psychologist Abraham Maslow, who applied his theory of the “hierarchy of needs” to the modern workplace. In Eupsychian Management, Maslow argues that work should be thought of as a key source of personal growth and self-actualization.

Maslow envisioned a world where individuals derive deep satisfaction from their working lives, and who treat their work as a sacred activity.

Since early 2021, I have conducted interviews with over 90 professionals and managers in Toronto, to learn how they think about work. Although there are exceptions, what the data shows, in general, is that Maslow’s theory has increasingly become common.

The downsides of the passion paradigm
Because the rising popularity of the passion paradigm has coincided with both increasing economic inequality and a steep decline in the power of unions, it has attracted a host of criticism.

Sociologist Lindsay DePalma contends that the passion paradigm encourages workers to romanticize their work while blinding them to the unequal distributions of power that characterize their working lives.

In her book Work Won’t Love You Back, journalist Sarah Jaffe argues that loving your job is a bad idea because it is a recipe for (self)exploitation.

Derek Thompson, a staff writer at The Atlantic, maintains that the passion paradigm has fuelled a new religion — “workism” — which is responsible for causing burnout and depression even among high-wage earners.

A man bends over, stocking shelves, in a fridge aisle at the grocery store.
It wasn’t just managers who were part of the Great Resignation. (Shutterstock)
These commentators rightly fear that the passion paradigm can (and does) lead workers to accept harmful working conditions, poor treatment from their employers and unrealistic expectations from themselves — basically to put up with what they shouldn’t.

When people aspire to love their work, they may prioritize work at the expense of other important aspects of life — family, friends and hobbies. An overvaluation of work can lead people to see those who cannot work as lazy, stupid or undeserving of concern.

And yet, despite these evident pitfalls, the passion paradigm can also have the opposite effects. In fact, I would argue that it is one cause of what has been dubbed the “Great Resignation.”

The Great Resignation
In August 2021, 4.3 million American workers quit their jobs, the highest ever recorded. And similar waves have hit the U.K..

In Canada it’s not clear whether the Great Resignation is taking place with equal intensity, but some studies show that Canadian workers are increasingly considering leaving or switching their jobs.

Read more: Vast majority of American workers like their jobs – even as a record number quit them

There are many factors causing the Great Resignation. Among the most notable are wage subsidies which have given workers more freedom to choose the kind of work they want to do, the added work stress caused by the pandemic, the need to stay home with young children and the shift to remote work.

However, I think another reason has to do with the expectations workers have around work — expectations which derive from the passion paradigm.

The passion paradigm and the Great Resignation
By disrupting people’s routines, the pandemic has reawakened in many the deep-seated desire for a job they actually enjoy — a desire that has long been suppressed.

My interviews make it clear that many Canadian workers are looking at their jobs and asking themselves, “Is this really what I’m passionate about?” “Do I want to spend the majority of my waking hours doing this?” “Does my job bring me meaning?”

And this isn’t just managers. The highest number of resignations in Canada have taken place within the accommodation and food service industries. And as a recent article in The Atlantic put it, “this level of quitting is really an expression of optimism that says, ‘We can do better.’”

In a sense, the passion paradigm is paradoxically fuelling the demand for better, more satisfying, and more meaningful work. It is because workers expect more that they are no longer willing to put up with the status quo.

A woman looks over boxes she is packing
The passion paradigm can fuel demands for better. (Shutterstock)
The passion paradigm requires a strong safety net
Of course, none of this could have happened without the government supports that reweighed the balance of power between workers and bosses.

Since the 1980s, workers have had less and less power to negotiate. So, while the passion paradigm may have grown in popularity, it grew in economic conditions that were largely determined by employers, not employees.

But in the wake of the pandemic this has slowly begun to change. Faced with labour shortages, employers are forced to take workers’ seriously when it comes to demands around pay, flexibility, autonomy and scheduling. They are receiving the message that “business as usual” is no longer acceptable — and, in some cases, they’re caving.

The crucial takeaway is that the passion paradigm can fuel demands for better, more meaningful work, but this is only possible when it’s accompanied by a strong social safety net.

Workers don’t need to stop loving their jobs. But they should ask whether their jobs are themselves loveable. And this is easier to do when you have real economic freedom.

17/01/2022

The Great Resignation: Historical data and a deeper analysis show it’s not as great as screaming headlines suggest
The so-called Great Resignation was one of the top stories of 2021 as “record” numbers of workers reportedly quit their jobs.

The latest figures came out on Jan. 4, 2022, and showed that 4.5 million people voluntarily left their positions in November – an “all-time high,” according to the agency responsible for collecting the data. That’s 3% of the nonfarm workforce, which headlines also proclaimed a record level.

But is it?

The “quit rate” interests me because I wrote my economics doctoral thesis on how people find work. Since then I have been fascinated by how people leave jobs and then find new ones.

Tracking ‘quits’
Data on people quitting comes from the Bureau of Labor Statistics.

Each month the bureau runs the Job Openings and Labor Turnover Survey, also known as JOLTS. The bureau interviews about 20,000 businesses and government agencies each month, which it uses to estimate several aspects of the workforce, including the number of people who quit, retired, got hired or got fired.

Since April 2021, the share of nonfarm workers who quit their jobs has been at some of the highest levels recorded by the bureau. In all, nearly 33 million people left their positions over this period, or over a fifth of the total U.S. workforce.

Certainly, that’s a lot of people. But a closer look at all the historical data we have can help put this in some perspective.

One issue is calling the current levels a “record.” The problem is the data only goes back a little over two decades, which means it’s certainly possible that the rate could have been higher at several points in the past. We just don’t know.

For example, during the dot-com bubble in the late 1990s and early 2000s, the U.S. economy was strong, which created many new jobs and opportunities for workers. These are typical precursors to more people quitting their current jobs in search of better pay and benefits. Given that the rate was 2.4% in January 2001 – a month after the quits data begins – it’s not a stretch to imagine it may have been higher than the current level at some point in 2000 or earlier.

Or another time when quits may have been higher was after World War II, when the postwar American economy was booming and the economy was in great flux.

In fact, some data pre-2000 does exist that suggests there are times when the quit rate may have been higher. The Bureau of Labor Statistics tracked the quit rate in the manufacturing sector from 1930 to 1979, when it ended the survey because the industry – which at one time made up as much as 28% of the economy – became less important.

Manufacturing workers, who make things like steel, cars and textiles, were quitting their jobs at a monthly average rate of 6.1% in 1945, compared with the 2.3% recorded for the sector in November 2021.

Since about a third of the U.S. workforce had manufacturing jobs in the late 1940s, this suggests the overall quit rate was likely higher back then.

Putting quits into perspective
A lot of stories have also focused on the absolute number of workers who quit their jobs, such as 4.5 million who quit in November – on a seasonally adjusted basis.

If quits for December 2021 are similar to November, I expect about 47 million people will have voluntarily left their jobs in all of 2021. That would mean about 33% of the total nonfarm workforce quit jobs last year.

Again, that seems like a lot, but a huge swath of the labor force does this every year. In 2019, for example, about 28% of the U.S. workforce quit.

So is quitting higher than normal? For sure. But off the charts enough to earn the moniker of “great”? I don’t think so.

Not all sectors are seeing a wave of quitting
Workers also aren’t quitting in droves across all sectors of the economy. While quits are higher than usual in most industries, a few sectors are responsible for most of the turnover, with some lower than their recent peaks.

The highest quit rate is in accommodation and food services. About 6.9% of people working in hotels, motels, restaurants and bars gave notice in November. While that’s the highest since 2000, voluntary turnover in this sector is usually on the high side – given the nature of the work – and has been above 5% many times over the past two decades.

November’s second-highest quit rate, at 4.4%, was retail trade, which includes workers in stores and shops. Combined, these two relatively low-wage industries accounted for one third of all people who quit that month.

On the other hand, the quit rates for construction, information, finance and insurance and real estate are relatively low and have been higher in the past 21 years.

We can also see from the data that young people make up the biggest share of people switching jobs. Data from ADP, one of the largest payroll processors, breaks down turnover by age. But unlike the JOLTS data, ADP doesn’t learn why someone is no longer working at a company – whether they quit, got fired or something else – so it can track only total turnover.

ADP’s most recent data shows high turnover is concentrated among 16-to-24-year-olds, with a turnover rate almost three times the national average.

High turnover for young workers is not surprising, in my view, because COVID-19 restrictions have canceled many nonwage benefits like after-work socializing and company parties. For younger workers new to the labor force, these types of activities are important in developing company belonging and loyalty. Without them, there are fewer ties binding these workers to a company.

Reducing the quit rate
Nevertheless, just because the quit rate isn’t at a record doesn’t mean there isn’t a problem of too much turnover in the labor market. But that problem appears to predate the pandemic.

High annual quit rates mean many workers are not satisfied with their job’s pay, benefits or working conditions. And that can be a huge waste of time and money for both companies and workers. Hiring and training workers is expensive. And searching for new jobs and switching jobs is physically and emotionally difficult for workers.

Research shows employers can minimize turnover by many different methods, such as by giving workers a sense of purpose, letting them work in self-directed teams and providing better benefits.

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Individuals thinking about quitting should ideally find another job before quitting. You have a much higher chance of success transitioning from one job to another than trying to jump from unemployment to work.

The next time you hear about the “Great Resignation,” understand it isn’t quite as great as it seems, since large numbers of U.S. workers have been quitting for years.

17/01/2022

17/01/2022