Conditions for many years have favored employers over workers. A tight job market and high unemployment during the past 20 years created more potential candidates than positions. Employees held on tightly to their jobs, for fear of not finding work and the associated loss of income.
Things are changing dramatically. The US unemployment was 3.7 percent in June 2019, up from a 49-year low of 3.6 percent in the previous month. Many companies have more positions than candidates. With unemployment hitting an 18-year low this month, employees are suddenly in demand and they are on the move.
A few months back, The Wall Street Journal reported more workers are quitting their jobs and taking advantage of the current labor market; a market that is placing priority on workers rather than employers. Further, Labor Department data show 3.4 million Americans quit their jobs in April, twice the number of those laid off.
LinkedIn editor-in-chief Dan Roth told "CBS This Morning" on the 11th of July that the hot job market and 18-year low unemployment rate are creating an environment in the U.S. where there are “more job openings than candidates”, further stating that “It's a buyers' market right now."
So, what? Most managers have never experienced this environment. The lean availability of jobs from previous years has allowed some mangers to pick up bad habits with regard to employee retention. For years, a significant number of employees have put up with uncaring bosses, inadequate pay, poor job growth and lingering discontent. Employers beware! With new jobs creation and a soaring consumer confidence, employees now feel empowered to move on from stagnate or toxic environments and try something different.
What are the effects on organizations? At an alarming rate, people are starting to vanish at work. This activity is sometimes referred to as “ghosting”. Workers are simply finding something else, disappearing and moving on.
Last year, Chip Cutter, an editor at LinkedIn, indicated recruiters and hiring managers are experiencing a similar phenomenon. He believes the job market and a prolonged labor shortage are contributing factors to a surge in job candidate “ghosting”; where candidates abruptly cut off contact and turn silent. Candidates are obviously finding better deals, elsewhere.
Some employers are strategically aware of the current labor market trend and are taking proactive steps. According to Stephanie McGuinn of PI Midlantic, a predictive analysis consulting company, some corporations are trying to bolster commitment to counteract the current trend. Amazon has developed a unique retention strategy; offering full-time associates $5000 to quit. Yes Sir! You read that right. The program even has a name, “Paid-to-Quit”. Amazon believes the strategy will enhance employee engagement and save money in the long term. It’s not the program’s intent to make employees work harder; but instead foster stronger commitment from employees staying with Amazon.
So as employers struggle with employee mobility, know that there are risks and rewards when moving on. Some will not find the grass greener on the other side. However, according to the Federal Reserve Bank of Atlanta, there is a potential earnings benefit for those deciding to make the jump. They determined that during the past 12 months, job-switchers have enjoyed an almost 30% greater annual pay increases than those staying in place.
Sounds like a great year to transition!
Jay Hicks
The Transitioning Military Project Manager is available at AAFES Military Clothing Sales around the world and on AMAZON!
Jay Hicks is an author, instructor and consultant. With a special kinship for military personnel, Jay provides guidance on successful civilian career transition and has co-authored “The Transitioning Military Series”. He is the co-founder of Gr8Transitions4U, where advocating the value of hiring military personnel is the key focus. More about Jay and his passion can be found at Gr8Transitions4U.com.