The rapid pace of worker departures seen during the 'Great Resignation' has slowed significantly, with a new trend emerging: the 'Great Stay.' Labor economists attribute this shift to a combination of factors, including employer hesitancy to lay off workers and a decline in job openings spurred by the Federal Reserve's interest rate hikes.
The ' great resignation ' of 2021 and 2022 saw unprecedented numbers of workers quit their jobs amid ample and better-paying job opportunities. Today, it's the ' great stay .' Businesses pulled back on hiring due to higher interest rates. Fewer job openings hindered the prevalence of quitting.The ' great resignation ' of 2021 and 2022 has morphed into what some labor economists call the ' great stay ,' a job market with low levels of hiring, quits and layoffs.
'The turbulence of the pandemic-era labor market is increasingly in the rearview mirror,' said Julia Pollak, chief economist at ZipRecruiter.More than 50 million workers quit their jobs in 2022, breaking a record set just the year prior, attracted by better and ample job opportunities elsewhere.Silicon Valley's White House influence grows as Trump taps tech execs for key rolesis 'below what it was prior to the start of the pandemic, after reaching a feverish peak in 2022,' said Allison Shrivastava, an economist at job site Indeed.This dynamic — more people stay in their jobs amid low layoffs and unemployment — 'point to employers holding on to their workforce along with more employees staying in their current jobs,' Shrivastava said.Employer's 'scarring' is a primary driver of the so-called great stay, ZipRecruiter's Pollak said. Businesses are loath to lay off workers now after struggling to hire and retain workers just a few years ago.But job openings have declined, reducing the number of quits, which is a barometer of worker confidence in being able to find a new gig. This dynamic is largely due to another factor: the U.S. Federal Reserve's campaign between early 2022 and mid-2023 to raise interest rates to tame high inflation, Pollak said. It became more expensive to borrow, leading businesses to pull back on expansion and new ventures, and in turn, reduce hiring, she said
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