Thursday, October 13, 2016

Quitting Is Good!

Here's another economic indicator that is back to where it was before the recession: people quitting their jobs. The share of employees voluntarily leaving their jobs compared to total separations is back at post-recession highs.

The Bureau of Labor Statistics on Wednesday announced that in August, the share of total quits in relation to separations — voluntary or not — jumped to 60.2 percent, matching the post-recession high reached in December. In other words, nearly two-thirds of job separations were people voluntarily quitting rather than getting laid off or fired.

Why does that matter? A higher quits rate sends a positive message about the labor market because people are more likely to quit their jobs if they feel confident about finding a new one quickly, or if they already have another offer. It could also suggest that workers are leaving their jobs for better-paying ones, making it a predictor of wage growth and inflation.

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