In a typical example of media groupthink, almost overnight “the great resignation” has become a thing.
If there was any doubt about the legitimacy of the meme, any such doubt was put to rest when KPMG partner Bernard Salt wrote an op-ed in The Australian about it, claiming “the effects of fewer skilled immigrants and foreign students, as well as heightened demand for workers in logistics, technology, healthcare and agribusiness, and it’s no surprise that skilled workers are most likely to lead the charge into the great resignation”.
The sudden fear of mass resignations was apparently sparked by a single month’s data in the United States that suggested the resignation rate during August was 2.9% (compared with 2.4% in 2019).
Leaving aside that a single month could be an anomaly (and that the year-on-year growth was barely noticeable anyway), the whole notion of a great resignation makes little sense. Where are all the workers going to go? To a beach in Thailand for the rest of their lives? If anything, we may encounter a short-term “great switch”, but even that is unlikely.
Professor Mark Wooden and Professor Peter Gahan from Melbourne University were far more percipient, observing in The Conversation that not only is there no evidence of a great resignation in Australia, but resignation rates are in fact at an all-time low (only 7.6% of Australians changed jobs in the year to February) and even if people were resigning, it wouldn’t necessarily be a bad thing.
In their desire to fill clickbait-driven column inches, Australia’s intolerably lazy and time-poor media rolled out a yarn based on limited US data while neglecting to undertake the barest of critical thinking.
The US labour market has been a mess for years; weaker labour laws and the growing power of tech have meant shareholders and customers have run roughshod over workers. While many correctly point out the overall anaemic levels of wage growth in Australia, at least there has been some wage growth (minimum wage levels in the US remain at an appalling US$7.25 an hour):
There has been a significant tightening in some areas of the labour market, which like global supply chains have been impacted by pandemic-led border closures and, moreover, rampant money-printing which is finally leading to the long-awaited breakout of inflation.
However, long-awaited wage rises, which in many cases fall far short of general inflation levels, are quite different to a “great resignation”. Instead, businesses that treat employees well — not merely in terms of remuneration, but through career progression, respect and learning — will continue to attract great talent. Those who treat them poorly will naturally struggle to attract and retain outstanding staff.
That is more creative destruction than great resignation.
Don’t underestimate the cost of housing as an ever increasing factor on labour discipline, making the securing of a stable income more pressing than a willingness to push for higher wages. The percentage of people just a couple of mortgage or rent payments from disaster is growing.
Laws restricting and discouraging unions have made changing jobs probably the best way to improve your income and reduce your rent or mortgage stress. Unless you have real leverage, getting more money outside of a promotion is a questionable proposition. However, changing jobs may come at a cost to the stability of the income, or a loss of entitlements like sick or parental leave, that also have implications for keeping that roof over your head. Overall, upward social mobility appears to have been on a long decline for around 30 years. Moreover, automation and “flexible” working arrangements keep knocking chunks off the middle and respectable working class. In such circumstances, the great resignation looks more like a wish fulfilment of the put upon, rather than a description of reality. However, at least until the great immigration wave returns, some people in different sectors of the economy may enjoy advantages, even income increases, from job hopping. Good luck to them.
Sounds like the old joke, “Bed in boarding house collapses, dozens injured”
I call utter BS on The Great Resignation – as a concept, as a reality (it is not) as anything but a cliche, a catchphrase similar to Bernard Salt’s ‘smahed avo’ generation moment. Lower end jobs have always had massive staff turnover. What would be revolutionary is for middle income occupations to have similar turnover to poor hospo workers and short term CEOs. Can’t see it happening. One will never have money and rent forever or reside in trailer parks. The other in paid off multi-million dollar mansions throughout the world.
Lucky the burger flippers, mop pushers, fruit pickers don’t have mortgages then… of course they would also just like some more money to pay their giant rentals. As if!
The unemployment rate in the USA is substantially less than in Australia.
Which means that businesses hiring have to pay higher wages to attract people.
From what I understand, the situation in the USA is not to do with “middle class professionals” but in the lower paid service industry. People are only quitting because they can get more money for the same, or similar, job.
“clickbait-driven column inches”. Love that line, and is so true of the Australian.