The Great Resignation and The Great Deflate

from Serendipity35

2021 was the year of the “Great Resignation.” We have been told that it was a year when workers quit their jobs at historic rates. This is an economic trend meaning that employees voluntarily resign from their jobs. Blame has been aimed at the American government for failing to provide necessary worker protections in response to the COVID-19 pandemic. This led to wage stagnation. There was also a rising cost of living. The term was coined in May 2021 by Anthony Klotz, a professor of management at Texas A&M University.

It’s now 2022 and unemployment rates have fallen sharply from their pandemic highs. The labor force participation rate – which is the percentage of people in the workforce, or looking for a job – has increased, though not to its pre-pandemic level.

It was thought in 2020 that 2021 with a vaccine would mark the renormalization of the economy, schools, and life in general. But Covid variants wiped out that vision.

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  1. The pandemic has made a significant impact on life as we know it. It has come with its huge downfalls. At the same time, the pandemic arguably has had some significant positive outcomes as well. One of these so-called positive outcomes is the great resignation. At first glance, the term great resignation sounds as if the economy is in shambles and people are quitting their jobs out of sheer fear, however that was not the case. The reality of the great recession was that most people were quitting their job to claim unemployment benefits. The pandemic benefits during the years 2020 and 2021 were super accommodative. Some people made more money claiming unemployment benefits than they did working full time at their old job. These accommodative unemployment benefits led many underpaid workers to quit their job, and seek refuge in the unemployment benefits. Companies that severely underpaid their workers felt the most impact as they lost the most workers. For the first time in America, the average American had leverage against these big corporations who refused to pay their employees fairly.
    For many years, companies paid their employees the least amount of money possible to boost revenues and please shareholders. These companies argued that margins would be negatively impacted if they raise wages. This was not fair for the employees slaving away at a job that barely provided them a minimum wage that could support life. Capitalism in America has blinded the reality of life for many. Companies can not underpay their employees and get away with it, it is borderline slave labor. Thankfully American workers woke up during the pandemic and realized that they are worth more than the minimum wage. Americans stood up against these companies by quitting their jobs. After millions of Americans resigned from their jobs, companies started desperately looking for help. Companies had no luck in finding workers as they kept undercutting Americans. This led to substantial wage increases as companies had to meet the unemployment benefits, or surpass the wage to attract workers. Many companies increased their minimum wage for all their employees. The irony of the rise in wages is that margins were barely affected. Since the great recession earnings have come in better than expected and at all-time highs for many companies. This means that the rise of wages in actuality correlated more with a rise in profits.

  2. The Covid-19 Pandemic has spurred an extremely large and impactful social change called The Great Resignation. Put simply, thousands of workers have voluntarily chosen to leave the US job market since the onset of the pandemic. There are countless reasons why employees have left their jobs. Some reasons include fear of falling ill from the Coronavirus or fear of spreading Covid-19 to their children. Other employees were overworked and experienced burnout as they needed to fill in for others who were out sick and because of the increased demand for goods and services in certain industries. Some workers began to realize while they were working remotely, that they actually do not like their job, and that they want to find something which suits them better. These workers began to think about other jobs and industries which might be better fits for them. Many women resigned from their jobs to help their children with online school as it become very hard for their families to balance working remotely and helping young children with online school. Also, many Baby Boomers choose to have early retirements as they wanted to avoid becoming sick with the Coronavirus, their investments have appreciated significantly, and their home prices are prime for selling if downsizing is needed. All of the above reasons are huge factors for why many workers choose to leave their jobs. However, these factors also are concerning as many jobs could be lost in certain industries if employees choose to not return to work.
    Although jobs many be lost, aggressive employees have a lot of opportunity available for them. Now is the perfect time for people to look for jobs. Companies are desperate for employees, financial compensation and other benefits have been increased in order to try to obtain talent, and competition is reduced as many past employees are choosing to leave and never return into the workforce. The Great Resignation is creating opportunities for those who are aggressive and willing to work, while reshaping the entire US labor market. It will be interesting to see how companies evolve and adapt to the major social change they are being presented with.
    It is also important to note that the great resignation does not apply to all industries. Employment has risen for pharmaceutical companies who are producing crucial vaccines, and jobs in warehouses have risen too in response to the increased demand for goods being purchased online. The Great Resignation and other social changes caused by the Covid-19 pandemic are restructuring the US job market by creating and destroying various different jobs.

  3. I have seen and heard about many people resigning from their own jobs within the past 2-3 years. I believe that there are two huge roles that take place in this. This first one is people being worried about the pandemic. The other one is the fact that people can collect unemployment. First, people are worried that they can be harmed by the virus that is spreading around. They are also worried that they can affect other people such as their parents which would affect them way more than it would affect them if they had the virus. For instance, a year and a half ago my mom made me take a leave of absence from my job at a supermarket because she was concerned that I would get Covid or worse spread it throughout the house and give it to my grandpa. Next, people can collect unemployment. Nowadays, humans are lazy, they will look for the option that involves the least amount of work most of the time. So why not resign from your job if you can get money for free. People these days are more lackadaisical than ever. Lastly, the pandemic came out of nowhere and forced companies to fire some employees. This pandemic was a big surprise to companies all over the world and it has affected our lives in a humongous way. Now we have to wear a mask almost everywhere we go. This caused new employees to get fired everywhere which took a big hit on unemployment. In conclusion, this pandemic has made a substantial effect on work lives all over the world.

  4. The Covid-19 pandemic has caused extreme unrest and significant hardship among families in America. In addition, it has led to a drastic rise in unemployment rates. 2021 was known as the year of quitting or the Great Resignation in which tens of millions of workers vacated their jobs.

    Labor force participants had various reasons to resign from their jobs. For instance, many health care workers were overburdened with extremely busy schedules and immense stress that affected their mental health. In addition, health care workers are exposed to the virus every day and in fear for the safety of their family members. According to recent polls and surveys conducted by various organizations, eighteen percent of healthcare staff have quit since the pandemic started in February 2020. They were overwhelmed and decided to leave.

    Another common reason is that at the commencement of the pandemic, many companies had to lay off workers. For instance, the tourism and hospitality industry was severely damaged and were forced to fire employees. In addition, low wages and a lack of benefits combined with poor work-life balance convinced many former employees working at retail and fast food stores to quit. The U.S. unemployment rate rose as high as 14.7% in April 2020. This high unemployment ushered in food insecurities and rent issues among families throughout America. The pandemic devastated the nation’s economy and created steep drops in GDP.

    The federal government and local organizations have taken several initiatives to recover from the pandemic for months. One of the major plans includes an investment of 25 billion dollars into a vaccine manufacturing and distribution process that will reach every American for free. In addition, the government enacted a series of laws including the Coronavirus Aid, Relief, and Economic Security (CARES) Act and the American Rescue Plan Act to provide relief to small businesses and families. The CARES Act comprises a $2.2 trillion stimulus bill that will combat the pandemic on all economic aspects. Furthermore, the American Rescue Plan Act contains a $1.9 trillion stimulus bill that will provide grants to states and local governments for financial assistance to households for rent, food, and other expenses. All these steps are aiding in regaining America’s economy. The economy is finally recovering and GDP has returned to its pre-pandemic level. Also, a record of 6.4 million jobs was added in 2021, rebounding the economy. The economy is on a track for strong growth and recuperation.

  5. Many factors played in the Great Resignation. One was the increase in layoffs by companies. In the CNBC article linked in the original article, it said “The pandemic accelerated the trend toward automation as companies embraced digital waiters, concierges and other technologies amid social distancing rules and virus fears. In 2020, the World Economic Forum surveyed about 300 global companies and found that 43% of businesses expect to reduce their workforces with new technology.” The growing technology in the world has decreased the number of jobs in some companies. As it is getting rid of jobs, the companies are profiting using this technology. This innovative technology can also help the stock market and avoid a crash that we’ve seen in the past. hoping the stock market could also create new jobs that could fill in for these jobs lowest by the technology.

    Another factor could be COVID restrictions in the workplace. Many states have rules of their employees wearing a mask at their desk jobs, and some people might not be comfortable wearing a mask for eight to 10 hours. Because we pandemic has also provided a new system of working from home. Many have liked the experience of working at home rather than working at their desk jobs. Working at home could also help them live through this stressful time of COVID.

    The article also said that there has been an increasing number of people dropping out of college. It reads, “The newest report I found from the National Student Clearinghouse Research Center (NSCRC) shows that postsecondary enrollment has now fallen 2.6% below last year’s level. Undergraduate enrollment has dropped 3.5% so far this fall, resulting in a total two-year decline of 7.8% since 2019.” I’ve asked to do with Some of the COVID restrictions at these universities and campuses. These kids have also had a lot of time thinking about their future careers during this COVID break from school. With the stock market at this low, maybe they thought this was the right time to get started and buy into their careers.

  6. To summarize the article, it was theorized that there were two reasons why the labor force participation rate has increased in 2021: Wage stagnation and rising cost of living. The finger was pointed at the US government. Increased unemployment would usually carry a negative connotation, but to economists it’s a hopeful sign: People quit their jobs usually because they are financially stable enough to not work, or there is hope for a potentially better job. Yet, the quits still came at an odd time, when the threat of inflation was looming and the Omicron variant was making headlines. It was thought that people may have just been ‘burned out’ or overwhelmed. This could lead people to simply quit, even without the prospect of searching for better work opportunities. The Great Resignation is a new phenomenon; in fact it is speculated that it is a cyclical event that was merely sped up by the pandemic. We can all rest assured that the Great Resignation will slow down in time.

    I have personally felt the effects of The Great Resignation from my job at Home Depot. We weren’t always hurting for workers, but I have heard the stories from my coworkers about how smoothly everything went before the pandemic hit; we had no shortage of workers, and it seemed to be a golden age of sorts for Home Depot. That all ended just a little before I came, reinforcing the theory of the Great Resignation. The nearby Applebee’s is also always hiring.

    If people don’t start returning to work soon that spells good news for me, as employers will likely be forced to increase wages to attract new workers. Either way, even if they don’t increase wages, I hope people don’t return, as that means employers will be hurting for work! I’ll get to job-hop and try out as many different professions as I want!

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