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Are wage increases next?
More U.S. workers quit their jobs in December 2015 than at any other time since December 2006, according to the monthly report on job openings and labor turnover prepared by the Bureau of Labor Statistics (BLS).
The BLS report showed that nearly 3.1 million people headed for the exits in December, while employers hired nearly 5.4 million workers and 5.6 million new jobs became available, some of the highest reported numbers since the 2007-09 recession began.
“The findings showing an increase in both job openings and the quits rate are pointing to a more dynamic labor market,” said Jennifer Schramm, SHRM-SCP, manager of workforce trends at the Society for Human Resource Management.
“It’s a candidate’s market, with more individuals making voluntary separations from their employers,” said Lauren Griffin, senior vice president at Adecco Staffing USA, a recruitment and staffing firm headquartered in Jacksonville, Fla. “This indicates that employees were more confident to pursue new opportunities in advance of the new year.”
The quits rate—rising from 2 percent in November 2015 to 2.1 percent in December 2015— shows that job seekers are more assured about finding new opportunities, Schramm said. “The low unemployment rate of 4.9 percent reported last week is within the range considered to be full employment. These conditions indicate a very favorable job market for job seekers, especially those with in-demand skills and experience.”
Schramm added that a rising quits rate also supports the need for more focus on retention. “As the quits rate rises, employers may need to do more to retain their most valuable talent, and this may include raising wages,” she said.
People quitting their jobs and moving on to better-paying opportunities elsewhere is a leading indicator of wage inflation.
Of the 5.6 million jobs which became available in December 2015, openings increased from November in industries such as construction (+69,000), nondurable goods manufacturing (+60,000) and durable goods manufacturing (+26,000).
Total separations for the month of December—including quits, layoffs and discharges—rose from 4.9 million to 5.1 million. There were 1.6 million layoffs and discharges in December, a drop from 1.7 million the month before. In addition, there were 411,000 separations reported due to retirement, death and disability, and company transfers.
Over the 12 months ending December 2015, hires totaled 61.4 million and separations totaled 58.8 million, yielding a net employment gain of 2.6 million.
“The number of layoffs and discharges decreased over 2015, indicating a stable market,” Griffin said. “We predict that this will continue for years to come as the economy continues to recover.”
Roy Maurer is an online editor/manager for SHRM.
Follow him @SHRMRoy
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