Are Americans becoming quitters in America? Perhaps it is.
Record numbers of workers quit their jobs during the COVID-19 pandemic. As the COVID-19 pandemic ravaged the country, 2020 saw the largest decline in labor force participation, dropping from 63.2 percent to 60.8% in the fourth quarter of 2019. This is according to Federal Reserve Bank of St. Louis. It also said that about 2.4million people were “excess retires” in the initial year of the pandemic. This means they are not expected to cease working in normal circumstances. According to the Bureau of Labor Statistics in November 2021, nearly 31% of American workers quit their jobs. Near the close of the year, the number of workers was approximately 4 million lower than it was before the pandemic.
Tech, child care and health care are the hardest hit industries by this wave of quitting. According to the, 2020 was a year in which 3.6 per cent more employees of the health sector quit their job than previous years. Harvard Business Review. According to the latest data available in December 2021, day care and education jobs were down 10 percent and 5.5 percent, respectively, from their pre-COVID February 2020 peaks. In total, more than 1.5 million female workers were missing.
The Great Resignation is a term that describes this phenomenon. It has been observed in all parts of the world. It became an inescapable feature of the U.S. economy as the pandemic lasted. This is reshaping America’s work environment as people leave their jobs.
In some ways, resignations were caused by the virus, especially in 2020. Most of those who “excessively retired” were old workers that are particularly vulnerable to COVID-19. They decided, understandably, to quit the workforce several years earlier.
A 2020 report by the St. Louis Fed also noted that the unexpected twist to the downturn that resulted from the pandemic was the increase in the value of assets such as stocks and homes. During this time, households spent less on many items, including eating out. People had therefore more money in the bank accounts. Most economists expect that people will work less when they are wealthy.
Also, a policy decision was made to improve household wealth. In the year or so following the March 2020 onset of the pandemic, Congress passed roughly $6 trillion in pandemic aid and economic stimulus—much of it, like expanded unemployment benefits, designed to put cash into people’s pocketbooks. Personal savings rates rose after the federal pandemic-relief check was sent to every household.
In summer 2021 Americans had become relatively wealthy. This meant workers could choose where and when to work, particularly if they were in low-wage positions. Many chose to stop, at least temporarily.
Americans can be much more flexible about what work they do and who they are working for. It is more than just a tale of American workers quitting the workforce. It is also a story of Americans using new tools and resources to work differently—in many cases, online and for themselves.
Labor Department data shows that self-employed people have increased by half million since the beginning of the pandemic. In the 10 first months of 2021, applications for federal tax identification numbers (FTIN) for new business increased 56 percent. You can find more information at: The Wall Street Journal It was reported that most new businesses were unlikely to employ employees in November. The employment at large companies fell for the first-time in over a decade and half. Total self-employment reached a high not seen in more that a decade. By almost any standard, this is the most significant boom in entrepreneurship that has occurred in decades.
Although the Great Resignation might be considered a sign of Americans being tired of their jobs, or worse, tired under the pressure of COVID, the fact that so many Americans desire to be free from the constraints of bureaucratic inflexibility and rigidity of big organizations could also indicate this. This is possible thanks to online tools, such as Zoom, Substack, Etsy, and Stripe. Americans are able to use economic downturns of the pandemic era as a chance to reset their priorities and get reoriented. Americans quit, yes. They are now returning to work.