As job quits remain high, there's a natural curiosity among observers as to how so many people can leave their jobs amid a raging pandemic and battered economy. In this segment of Backstage Pass, recorded on Jan. 5, Fool contributors Rachel Warren, Jamie Louko, Trevor Jennewine, and Jason Hall discuss.
Rachel Warren: We've been talking about 'The Great Resignation' it feels like forever now, for months now. It doesn't seem to be slowing down. The Labor Department released fresh data yesterday regarding worker quits in the month of November.
According to that report, the number of workers quitting their jobs increased to 4.5 million individuals from 4.2 million, which was above the previous record of 4.4 million quits that happened in September.
Essentially, this means three percent of workers voluntarily left their positions in the month of November, employers posted 10.6 million job openings. Which was down from a near-record 11 million the previous month, but still considerable.
At the same time, CNBC reported yesterday that growth in private payrolls is continuing to surge despite these high job quits that we're seeing. Private job growth according to ADP, totaled 807,000 for the month, well ahead of the Dow Jones estimate for 375,000.
Meanwhile, the U.S. unemployment rate is still hovering around 4%. It's actually decreased. So how can we be short so many workers with the unemployment rate where it is? What are some of these factors that could be driving these current trends in the labor force?
Jamie, what are your thoughts here?
Jamie Louko: Yeah, when you first brought up this question, I thought, me, I am a perfect example of this, just a few months ago, I quit my job because I was able to get this freelance job where I'm able to write every day on my own schedule without a boss telling me what to do every single day.
There are a lot of people like me, not exactly writing, but there are a bunch of gig and freelance jobs out there where we can go on Shipt, do Instacart, do something like that on our own time without a boss, and quite frankly, it's a lot better than having a job where a boss is telling you what to do exactly right in front of your face.
I worked in a grocery store, and it was not fun. And I'm enjoying my job much better now that I get to work whenever I want really.
But this surge in the gig economy is really giving workers, including me, and including tons of people I know and maybe even a few of you guys--
It's giving us the freedom to work in a better work environment, which is leaving some businesses stranded and short-staffed while we are still getting money. But we're just not technically in those standard jobs where we're seeing high unemployment.
Warren: Well, because those standard jobs report numbers, as far as I understand, they don't include gig workers, which the gig economy is just exploding.
Absolutely great points, Jamie. What about you, Trevor, what are your thoughts?
Trevor Jennewine: Yeah, I think Jamie hit on some important concepts there. I think some people are leaving the labor force. So you know that there are people out there struggling to find child care just because of what happened with the coronavirus.
There are probably people still worried about returning to work due to what's going on with the Omicron variant. Then I think there are people who have, maybe their priorities have changed.
Maybe they got used to being at home more during the pandemic and they're OK with taking a couple, for example, maybe they're OK with just one person working and the other person stays at home more to help with things around the house.
I think maybe people are willing to make that compromise, to a greater extent today than they were before the pandemic. Just because they got a taste for that life last year and the year before.
Like Jamie mentioned there, I think a lot of people are pursuing alternative options. Entering the freelancer market just because of all the benefits, the flexibility that comes along with that.
Warren: Absolutely, Jason.
Jason Hall: Yeah, I'm probably going to go on a bit of a wide chart storm here in just a second.
Warren: [laughs] Go for it.
Hall: I will go ahead and warn everybody. But I think Jamie, Trevor are spot on here, all four of us right now, Rachel included. All four of us we're contractors.
We're not technically, we're not employees. I mean, we're an example of part of that cohort that isn't necessarily reflected in the data. But I think there's a bigger thing going on.
I'm going to just run through some data here, some charts that I think just they're really visually they're very tallying. What do we have here?
I brought it up a little bit when Rachel was doing the opening and this is the purple is job openings, so non-farm because that's very seasonal work and it can really skew the numbers.
So it's excluded when they talk about the payroll part and all that stuff. It's always non-farm.
That's the purple line and then the yellow is unemployed persons. These are people that have filed for unemployment or say, "Hey, I want a job, I'm trying to find one," that's what that data is.
