A Blog by Jonathan Low


May 22, 2022

Data Reveal All Those So-Called Quitters Are Working - At Better Paying Jobs

Despite grousing about quitters, the reality is that the vast majority - almost one to one - were actually swapping old jobs for new ones that pay higher salaries and offer better hours. 

Which is a lesson employers need to learn. JL 

Emma Goldberg reports in the New York Times, image L Form:

Many of last year’s job quitters are actually job swappers, according to data which shows a one-to-one correlation between the rate of quitting and swapping. What workers realized is that they could find better ways to earn a living. Higher pay. Stable hours. Flexibility. They expected more from their employers, and appear to be getting it. When workers switched jobs, they often increased their pay. Wages grew nearly 10% in leisure and hospitality over the last year, and more than 7% in retail. Workers were also able to increase their shift hours

If Applebee’s were the solar system — and for nearly six years, to Nick Haner, it felt that way — the customer would have been the sun. Everything revolved around the customer. The customer was always right, he was told. Even when the customer spit in Mr. Haner’s face. Even when the customer screamed that her salad should have been served hot, not cold. Even when the customer ripped his $2 tip in half.

But something happened, last year, to shift that orbit. It started with the signs that Mr. Haner saw popping up in windows as he drove to work: “Now hiring!” McDonald’s was hiring. Walgreens was hiring. Taco Bell closed early because it was short staffed. Everyone in Midland, Mich., it seemed, needed workers. So Mr. Haner began to wonder: Why shouldn’t work revolve around people like him?

“It’s absolute craziness,” said Mr. Haner, 32, who quit his job at Applebee’s last summer and accepted a fully remote position in sales at a tech company. “I decided to take a chance because I was like, ‘If it doesn’t work out, there’s 100 more jobs out there that I can find.’”

More than 40 million people left their jobs last year, many in retail and hospitality. It was called the Great Resignation, and then a rush of other names: the Great Renegotiation, the Great Reshuffle, the Great Rethink. But people weren’t leaving work altogether. They still had to make money. Much of the pandemic stimulus aid stopped by the fall, and savings rates dropped to their lowest in nine years, 6.4 percent, by January. What workers realized, though, is that they could find better ways to earn a living. Higher pay. Stable hours. Flexibility. They expected more from their employers, and appeared to be getting it.

Applebee’s said the safety of its workers and guests was a priority. “Aggressive behavior of any kind is not permitted,” said Kevin Carroll, the company’s chief operations officer.

Across the country, workers were flush with opportunities and could rebuff what they’d once been forced to tolerate — whether rigid bosses or customer abuse. And to keep businesses running, bosses had to start listening.

“People have seen this as a rejection of work, but I’ve seen it as people capitalizing on an abundance of job opportunities,” said Nick Bunker, director of economic research for North America at Indeed’s hiring lab. “People do need to pay the bills.”

As vaccines and stimulus money rolled out last year, and state and local governments urged a return to normalcy, businesses grew desperate for workers. Workers took advantage of the moment by recalibrating what they expected from their employers. That didn’t mean millions logging off forever and throwing their laptops into the sea. It meant low-wage workers hanging up their aprons and driving to another business with a “hiring” sign hanging on the door. It also meant white collar workers, buoyed by the tight labor market, telling their employers exactly how and where they want to work.

“Our employees have the power,” said Tim Ryan, U.S. chair of PwC, which is in the midst of a three-year transition that allows for more flexible work, including allowing much of the work force to go permanently remote, a process that Mr. Ryan estimates to be a $2.4 billion investment. That workplace transition is so grand that the executive of the 55,000-employee company had to describe it with a 2003 Disney reference.

“There’s a line in ‘Pirates of the Caribbean’ — I have six children — where one of the characters says to Elizabeth, ‘Do you believe in nightmares? You better, because we’re living in one,’” Mr. Ryan continued, with impressive but slightly off recall of Captain Hector Barbossa’s dialogue about ghost stories. “We’re living in this amazing transformation of the workplace, and we don’t even know it because we’re showing up every day living in it.”

Many of last year’s job quitters are actually job swappers, according to data from the Bureau of Labor Statistics and the census, which shows a nearly one-to-one correlation between the rate of quitting and swapping. Those job switchers have tended to be in leisure, hospitality and retail. In leisure and hospitality, the rate of workers quitting rose to nearly 6 percent from 4 since the pandemic began; in retail it jumped to nearly 5 percent from 3.5. White collar employers still struggled to hire, but they saw far fewer resignations. The quitting rate in finance, for example, declined at the start of the pandemic and is now just below 2 percent, and in media and technology it stayed roughly consistent, also below 2 percent.

When workers switched jobs, they often increased their pay. Wages grew nearly 10 percent in leisure and hospitality over the last year, and more than 7 percent in retail. Workers were also able to increase their shift hours, as rates of those working part-time involuntarily declined.

A slim share of people left the work force entirely, though for the most part that was driven by older men retiring before age 65 — and some of them are now coming back to work. The mismatch between the baby boomers retiring and the smaller cohort of young people entering the work force has also contributed to tightening labor supply. But broadly speaking, people aren’t done with work, and can’t afford to be. The last year brought less giving up and more trading up — to new jobs, more hours and better pay.

Workers didn’t really change their feelings about work; they changed their expectations: “Most people have never wanted to work and they do so because they need to live,” said Rebecca Givan, an associate professor of labor studies at Rutgers. “Now workers are saying, ‘We’re going to hold our bosses accountable and demand more from them.

Porsha Sharon, 28, still thinks about the outbursts she witnessed from customers she served last year at Buddy’s Pizza in Troy, Mich. One woman entered the restaurant and simply ordered a pizza, to which Ms. Sharon responded, gesturing at the extensive menu: Which kind?

“Did you not hear what I said?” the customer replied, according to Ms. Sharon’s recollection. “Are you dense?”

Other customers mocked Ms. Sharon for wearing a mask. The eight-hour shifts ended with burning pain in her swollen feet. She got an offer in March to start working as an administrative assistant at a law firm, work she did on a temporary basis in college, and last month she quit the pizzeria.

“The last generation, they were miserable in their jobs but they stayed because that’s what they were supposed to do,” Ms. Sharon said. “We’re not like that, and I love that for us. We’re like, ‘This job is overworking me, I’m getting sick because my body is shutting down, and I’m over it.’”

Katy Dean, chief operating officer of Buddy’s Pizza, a Michigan restaurant chain, said abusive customers were a “challenging component” of the current climate in food service. “If a guest refuses to calm down and treat our staff with respect, we empower our managers to ask that guest to leave the restaurant,” Ms. Dean said.

This workplace moment has been branded one of anti-ambition. But for many workers, frustration gave way to an explosion of ambitious calls for better jobs: for promotions, industry switches, stable hours, sick leave, bereavement leave, maternity leave, retirement plans, safety protections, vacation time. “No one wants to work anymore,” read a sign outside of McDonald’s featured in a viral TikTok. To which former Secretary of Labor Robert Reich replied: “No one wants to be exploited anymore.”

Last year when millions said “I quit,” the reckoning reached far beyond the confines of the companies and industries at its center. White collar workers weren’t quitting jobs at the same rapid clip as those in hospitality and retail. But they made bold demands of their employers all the same, cognizant that unemployment is low and competition for talent is fierce.

“There’s the threat of quitting rather than actual quitting,” Mr. Bunker said. “Employees realize they do have bargaining power.”

They’re exercising that power, in particular, where it comes to flexibility. The shutdown of offices left workers with a sense of autonomy they weren’t willing to relinquish. Even some of the seemingly unassailable bosses on Wall Street recognized that old norms couldn’t hold. Citigroup, Wells Fargo and BNY Mellon, for example, told bankers that their return to the office would be hybrid, and wouldn’t mean commuting five days a week.

Just 8 percent of Manhattan office workers are back in the office five days a week, according to data released this week from the Partnership for New York City.

“My quality of life increased so much that there would be no convincing me coming into an office was worth it,” said Lyssa Walker White, 38, who switched nonprofit jobs earlier this year because of her old employer’s expectation that she return to the office.

Some employers went ahead calling their workers back to the office, at least for some of the week, and found that they faced outright resistance. Apple, for example, which required its employees to return to the office three days a week, received a recent open letter from workers detailing their fierce opposition to in-person work.

“Stop trying to control how often you can see us in the office,” the Apple workers wrote. “Please get out of our way, there is no one-size-fits-all solution, let us decide how we work best, and let us do the best work of our lives.

The company declined to comment. Its hybrid R.T.O. requirement remains in place.

At other white collar workplaces, newly formed unions took up the remote work cause. The Nonprofit Professional Employees Union, for example, grew its membership from 12 organizations and 300 workers in 2018 to roughly 50 organizations and 1,300 workers this year. One member organization secured an agreement that managers would cover the costs of travel for workers required to commute; another got its management to agree to provide written justification to any employee required to return to the office.

At a recent industry conference, Jessica Kriegel, head of people and culture at Experience.com, a technology company, gathered with colleagues in human resources and swapped all kinds of stories about facing the requests of an emboldened staff. There were tales of people asking for raises quadruple the size of their salaries. There were tales of company strategy meetings that had once been held as closed-door retreats in Napa, and had now been expanded to include junior level staff in town halls.

Ms. Kriegel said she had given a top performer an eye-popping raise, and seen another race through three promotions, rising from a contributor to a director to a vice president, in just one year.

“They’re asking for title bumps not even associated with financial promotions in order to put it on their LinkedIn,” Ms. Kriegel said. “People who are entry level are getting the director level title.”

So the H.R. director raises an eyebrow when she hears colleagues say that people are over working, because she is watching her staff agitate for exactly the type of work they want to do: “We’re starting to see people feel they don’t have to live in fear,” she added. “It’s not about anti-ambition. It’s about incredible ambition.”

Mr. Haner, who left Applebee’s, was recently given his own raise, of 16 percent, putting him at an hourly pay substantially above his wages at Applebee’s. When friends ask about his new job, he waxes on about the thoughtful conversations he has with his manager. When he requested time off for his grandfather’s funeral, something he felt would have prompted a “tsk, tsk” at Applebee’s, he was told that his company offers bereavement leave.

While a job is still a job, his morning alarm no longer prompts that sense of dread because of a new sensation: “They treat us with respect.


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