In April 2020, the U.S. unemployment rate increased by 10.3 percentage points to 14.7%, the highest rate and largest month-to-month increase in the history of this data since the Bureau of Labor Statistics first recorded it in January 1948. A year later, in April 2021, 3.8 million workers quit their jobs, a record-high for a single month. Data shows a resurgence in the number of workers who are resigning for better jobs or exploring other opportunities – which could be the result of seeking better pay and benefits, improved working conditions, the ability to continue working from home and personal fulfillment. During the first five months of 2021, a total of almost 17 million private sector workers (or an average of 3.4 million workers per month) decided to quit. By comparison, an average of roughly 2.5 million workers quit per month between January 2001 and December 2020.
In this study, SmartAsset took a closer look at the high quit levels and rates in the U.S. The “quit level” is the total number of quits, while the “quit rate” is the number of workers quitting their jobs during an entire month as a percentage of total employment. We examined how these metrics have changed over time and identified the industries with the highest quit levels and rates from May 2021, the most recent data available. For more details on our data sources and how we put all the information together to create our findings, read the Data and Methodology section at the end of this report.
Key Findings
-
Nationally, quits hit a record high in April 2021 and remain elevated. In April 2021, the national quit rate peaked at 3.1% – the highest rate since December 2000, when the BLS started collecting this data. Quits made up close to 70% of total job separations in April 2021, and subsequently remained high. The following month, the national quit rate was 2.8% and quits made up about 68% of total job separations.
-
Accommodation & food service workers have the highest quit rates. Throughout the 21st century, accommodation & food service workers have quit their jobs at higher rates than workers in other industries. The historical average quit rate for accommodation & food service workers is 4.1%. This is 1.3 percentage points higher than the next-highest industry rate (retail trade). The May 2021 quit rate among accommodation & food service workers was even higher, at 5.7%.
-
Some industries have current quit rates that are significantly higher than their historical averages. Three industries – accommodation & food service, retail trade and nondurable goods manufacturing – have a difference of more than one percentage point between their historical average quit rates and May 2021 quit rates. The difference for the accommodation & food service industry is 1.6 percentage points, while it clocks in at 1.2 percentage points for the industries of retail trade as well as for nondurable goods manufacturing.
A National Look
On a monthly basis, the BLS reports total job separations, which fall into three categories:
-
Quits
-
Layoffs & discharges
-
Other separations
Quits are generally voluntary separations initiated by the employee, while layoffs and discharges are involuntary separations initiated by the employer. Other separations include separations between the employee and employer due to retirement, death, disability and transfers to other office locations of the same firm.
Since the separation rate includes all three of these kinds of terminations, it tends to be more variable than the quit rate. Over the past 20 years, the national jobs separation rate has ranged from 3.3% in October 2010 to 12.3% in March 2020. By contrast, there has been a less than two percentage point range between the lowest and highest national quit rates. The quit rate was lowest following the 2008 stock market crash, with only 1.3% of workers voluntarily leaving their jobs in August 2009. More recently, it hit its highest rate of 3.1% in April 2021.
The quit rate is generally low during periods of economic stress. For a five-year period from October 2008 through October 2013 – which included the lowest point of the Great Recession – the quit rate was less than 2%. Similarly, at the onset of the COVID-19 crisis in the U.S., the quit rate was 2.1% in March 2020 and dropped to 1.8% the following month.
The last year marks a dramatic shift in the quit rate, with it rising from 1.8% in April 2020 to 3.1% in April 2021. This shift can perhaps be best understood when comparing quits to all separations. In April 2020, quits made up only 17.25% of total job separations. Meanwhile, in April 2021, quits made up 69.55% of total job separations. The pie charts below show job separations in both April 2020 and April 2021, categorizing them by the type of separation.
Which Jobs Are Workers Quitting the Most?
In May 2021, the quit rate was the highest among accommodation & food service workers. About 706,000 accommodation & food service workers – or 5.7% of all accommodation & food service workers nationally – quit their jobs. With an overall separation rate for accommodation & food service workers at 7.1%, this means that quits made up more than 80% of all separations in the industry.
The quit rate is second-highest among retail trade and third-highest among arts, entertainment & recreation workers. About 606,000 retail trade workers and 58,000 arts, entertainment & recreation workers voluntarily left their jobs in May. Relative to industry employment, these quit levels represent rates of 4.0% and 2.9, respectively.
Gross figures for May 2021 quits are highest again for accommodation & food service workers, followed by retail trade workers and then professional & business service workers. More broadly, the highest gross number of separations overall occurred among professional & business service workers. In May, about 934,000 professional & business service workers either chose to leave their jobs, were laid off or had to separate for reasons such as death, retirement, disability or relocation.
Quit rates are not high across the board. Seven industries had quit rates below 2% in May 2021. They include:
Among those seven industries, quits made up the largest percentage of total separations among educational service workers, who initiated almost 75% of job separations in May. The table below shows May 2021 quit levels and rates by industry, along with quits as a percentage of total job separations.
Data and Methodology
Data for this report comes from the Bureau of Labor Statistics’ Job Openings and Labor Turnover Survey. The report is published monthly and includes information on job separations, including quits, layoffs & discharges and other separations. We considered only private sector employment for all sections of this report.
Tips for Maximizing Your Savings for a Career Shift
-
Preparing to leave or switch jobs? Make your savings work for you. Even if you are between jobs or taking time off of work, it is important to make sure your savings are invested so that they can continue to grow. Our investment calculator can help you see how your investment in a savings account can grow over time.
-
Contribute to a 401(k). A 401(k) is an employer-sponsored defined contribution plan in which you divert pre-tax portions of your monthly paycheck into a retirement account. Some employers will also match your 401(k) contributions up to a certain percentage of your salary, meaning that if you chose not to contribute, you are essentially leaving money on the table. Our 401(k) calculator can help you determine what you saved for retirement so far and how much more you may need.
-
Too legit to quit on your financial goals? Consulting an expert could save you time and money in the long run. If you are looking for guidance and are able to do so, a financial advisor may be able to help you create a plan for your money goals. SmartAsset’s free tool matches you with financial advisors in five minutes. If you’re ready to be matched with local advisors, get started now.
Questions about our study? Contact us at [email protected].
Photo credit: ©iStock.com/izzetugutmen
The post A Record 3.8 Million Workers Quit Their Jobs in April 2021: Who Are They? appeared first on SmartAsset Blog.
