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Posts tagged with: "JTS1000QUR"

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Quits in the private sector vs. quits in government

A data story of a segmented labor market

Although the FRED Blog is committed to the long haul, we’ve discussed quitting before: that is, data on voluntary separations from employment. For example, earlier this year, a post covered quits for currently employed workers during economic downturns.

Conventional wisdom says that quits decrease during recessions and increase during expansions. But because there was hardly anything conventional about the COVID-19-induced economic shock, we take a look at the recent evolution of voluntary separations. And from the graph above, we see that the overall level of quits has reached new heights.

The graph plots data from the Job Openings and Labor Turnover Survey from the U.S. Bureau of Labor Statistics (BLS), showing the percentage rate of quits among all nonfarm employees (in black), private-sector employees (in blue), and government employees (in red). Because private-sector employees greatly outnumber government employees, the all-employees quit rate most closely reflects the labor market experiences of that private-sector group. Yet, regardless of the relative size of each section of the labor force, private employees quit their jobs three times more frequently than government employees do.

The data show some milestones: In August 2021, the overall quit rate hit at an all-time high of 2.9%. Private-sector employees have been quitting their jobs at unprecedented rates since April 2021, reaching 3.3% in August 2021. In contrast, the record-high quit rate among government employees is 1.1%, reported in both July and October of 2020. It has declined since then and seems to be returning to its very stable recent average of 0.8%.

These developments provide additional evidence that the private and public groups occupy different segments of the labor market. The January 2020 BLS survey on employee tenure reports government workers keep their jobs almost twice as long as private-sector workers do. Researchers at the BLS point out the former are, on average, older than the latter. No doubt the incentives to remain on the job significantly change with age, but when overall labor conditions change dramatically, perhaps the sunk cost fallacy (i.e., staying on a course of action due to a cost that has already been incurred and cannot be recovered) is unduly affecting some workers’ choices.

How this graph was created: Search for and select “Quits: Total Nonfarm,” using the “Monthly, Rate, Seasonally Adjusted” series. From the “Edit Graph” panel, use the “Add Line” tab to search for and add “Quits: Total Private” and “Quits: Government” to the graph. Remember to select the data frequency and units listed above.

Suggested by George Fortier and Diego Mendez-Carbajo.

View on FRED, series used in this post: JTS1000QUR, JTS9000QUR, JTSQUR

Quitters, public and private

St. Louis Fed economist David Wiczer recently assessed the labor landscape by comparing rates of workers quitting their jobs with rates of workers being let go. This graph takes a simpler view and shows the rates of workers quitting in the public and private sectors. The private-sector rate is obviously higher; in July 2005, for example, the private-sector rate was 460 percent of the public-sector rate.

Not surprisingly, though, the rates track each other pretty closely: Any worker would be more inclined to quit a job when economic prospects are good and less inclined when they’re not so good. But the data behind this graph show that the gap between the rates has narrowed a bit since the recent recession. From December 2000 to June 2009, the private-sector rate was on average about 350 percent of the public-sector rate; since then, the gap has fallen to about 320 percent. The graph does show a recent rise in the private-sector quit rate, however, so the gap may be increasing.

How this graph was created: Select the first series, “Quits: Total Private,” and then add the second series, “Quits: Government.” Both series shown here are seasonally adjusted monthly rates. You can also search for specific industries (e.g., construction or manufacturing) and other measures (e.g., layoffs and discharges).

Suggested by George Fortier.

View on FRED, series used in this post: JTS1000QUR, JTS9000QUR

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