Majority of U.S. Workers Changing Jobs Are Seeing Real Wage Gains

Roughly one-in-five workers say they are very or somewhat likely to look for a new job in the next six months, but only about a third of these workers think it would be easy to find one BY RAKESH KOCHHAR, KIM PARKER AND RUTH IGIELNIK Amid reports of the Great Resignation, Pew Research Center conducted this study to better understand the experiences of individual workers who switched employers in any given month from January 2019 to March 2022. Part of the study is based on the analysis of monthly Current Population Survey (CPS) data from January 2019 to March 2022. The CPS is the U.S. government’s official source for monthly estimates of unemployment. About three-quarters of the people interviewed in one month of the CPS are also interviewed in the next month, and about half of the people interviewed in one year are also interviewed in the same month the next year. The analysis exploits these features to study the monthly transitions of individual workers from, say, employment to unemployment, and to examine the changes in their earnings from one year to the next. Another part of the study is based on a nationally representative survey of U.S. adults conducted by Pew Research Center from June 27 to July 4, 2022, using the Center’s American Trends Panel. The survey encompassed 6,174 adults, including 3,784 employed adults. The COVID-19 outbreak affected data collection efforts by the U.S. government in its surveys, especially in 2020 and 2021, limiting in-person data collection and affecting the response rate. It is possible that some measures of economic outcomes and how they vary across demographic groups are affected by these changes in data collection. “Employer switchers” or “job switchers” are workers who were employed in two consecutive months but report having changed employers. The switch may have happened voluntarily or involuntarily. Some of these workers may have been unemployed for up to four weeks in the transition from one job to the next. “Unemployed” refers to workers who are currently without a job but are actively seeking work. “Not in labor force” refers to workers who are neither employed nor actively looking for work. This group includes those who are retired, as well as workers who intend to return to the labor force sometime in the future. White, Black and Asian adults include those who report being only one race and who are not Hispanic. Hispanics are of any race. Other racial and ethnic groups are included in all totals but are not shown separately. “High school graduate” refers to those who have a high school diploma or its equivalent, such as a General Education Development (GED) certificate, and those who had completed 12th grade, but their diploma status was unclear (those who had finished 12th grade but not received a diploma are excluded). “Some college” include workers with an associate degree and those who attended college but did not obtain a degree. “Real earnings” refers to earnings adjusted for inflation. The Great Resignation of 2021 has continued into 2022, with quit rates reaching levels last seen in the 1970s. Although not all workers who leave a job are working in another job the next month, the majority of those switching employers are seeing it pay off in higher earnings, according to a new Pew Research Center analysis of U.S. government data. From April 2021 to March 2022, a period in which quit rates reached post-pandemic highs, the majority of workers switching jobs (60%) saw an increase in their real earnings over the same month the previous year. This happened despite a surge in the rate of inflation that has eroded real earnings for many others. Among workers who remained with the same employer, fewer than half (47%) experienced an increase in real earnings. Overall, 2.5% of workers – about 4 million – switched jobs on average each month from January to March 2022. This share translates into an annual turnover of 30% of workers – nearly 50 million – if it is assumed that no workers change jobs more than once a year. It is higher than in 2021, when 2.3% of workers switched employers each month, on average. About a third (34%) of workers who left a job from January to March 2022 – either voluntarily or involuntarily – were with a new employer the following month. When it comes to the earnings of job switchers, the share finding higher pay has increased since the year following the start of the pandemic. From April 2020 to March 2021, some 51% of job switchers saw an increase in real earnings over the same months the previous year. On the other hand, among workers who did not change employers, the share reporting an increase in real earnings decreased from 54% over the 2020-21 period to 47% over the 2021-22 period. Put another way, the median worker who changed employers saw real gains in earnings in both periods, while the median worker who stayed in place saw a loss during the April 2021 to March 2022 period.1 Perhaps not coincidentally, Americans cited low pay as one of the top reasons why they quit their job last year in a Pew Research Center survey conducted in February 2022. A new Pew Research Center survey finds that about one-in-five workers (22%) say they are very or somewhat likely to look for a new job in the next six months. And despite reports of widespread job openings, 37% of workers say they think finding a new job would be very or somewhat difficult. Workers who feel they have little or no job security in their current position are among the most likely to say they may look for new employment: 45% say this, compared with only 14% of those who say they have a great deal of security in their job. Similarly, those who describe their personal financial situation as only fair or poor are about twice as likely as those who say their finances are excellent or good to say they’d consider making a job change (29% vs. 15%). Among workers leaving a job between 2019 and the first quarter of 2022, the

Despite ‘skills-based’ hiring push, employers overlook nontraditional candidates

Recruiting tools and processes may fail to consider workers without a four-year degree, panelists said during a June 28 joint EEOC and OFCCP webinar. Ryan GoldenSenior Reporter Despite signs that employers are willing to prioritize skills over educational attainment when recruiting, candidates with nontraditional work backgrounds continue to be overlooked, according to panelists at a virtual event hosted Tuesday by the U.S. Equal Employment Opportunity Commission and Office of Federal Contract Compliance Programs. A general trend over the past 20 years has seen businesses employ four-year degree requirements in their job descriptions, narrowing the field of potential candidates despite “hundreds of thousands of people” performing such jobs without a Bachelor’s degree, said Byron Auguste, CEO and co-founder of the nonprofit Opportunity@Work. Auguste and other panelists spoke about the need for employers to engage job candidates who are skilled through alternative routes, or STARs. These candidates, Auguste said, often are hindered by their backgrounds in pursuing advancements or face other barriers in the recruitment process even as less qualified, traditional candidates are favored. “People with advanced degrees are given much deeper roles that they may not be a fit for,” Auguste said. “This is a big problem for STARs, but it’s a bigger problem for [businesses] and employers.” A complete rebuild Resetting degree requirements for job posts is a strategy that predates the pandemic. A 2022 report by the Burning Glass Institute found that some 46% of middle-skill occupations and 31% of high-skill occupations saw degree requirements reset between 2017 and 2019. More recently, Maryland’s state government dropped four-year degree requirements for thousands of roles, and the push to hire for skills over degrees even received a shoutout at the 2022 State of the Union address. But employers seeking to expand opportunities to STARs may need to consider making more fundamental changes to the way they hire. That could mean a full reset of all positions, from top to bottom. That is the approach taken by one healthcare industry employer that partnered with OneTen, an executive coalition that focuses on closing opportunity gaps for Black talent in the U.S. Panelist Maurice Jones, OneTen’s CEO, said the employer initially sought to fill only a segment of roles, but after a period of just a few months, the company rebuilt all of its positions using what Jones called a “skills-first perspective.” In all, the company redesigned nearly 3,000 jobs. “That is what we’re looking for,” Jones said, noting the role that a central vision from leadership played in the effort. “It took the senior C-suite folks, hiring managers and people managers to say, ‘You know what? We should have been doing this years ago.’” Organizations already may have internal STARs who could benefit from clearer paths to advancement, Auguste said. Some barriers may be ingrained into pay structures and other facets of HR aside from the initial sourcing stage. For example, Auguste noted he has seen cases in which an employment contract states that an employer will pay less for someone who does not hold a college degree. “Companies are putting in a lot of barriers that they don’t need at all,” he said, adding that employers may want to create and expand internship and apprenticeship models for STARs. Screening and sourcingEmployers can broaden their reach in new ways thanks to the increased adoption of flexible work. Jones gave the example of a company based in the western U.S. that sought to open more opportunities for Black talent. Seeing a lack of such talent locally, the company decided to transition more of its jobs to remote status, allowing it to recruit nationwide, he said. For other organizations, the problem is not so much the availability of talent, but how that talent is screened. “You can’t see what you’re missing,” Auguste said. “Once you remove those barriers, now you can start to see.” Human recruiters may insert their biases into the process by defaulting to candidates with traditional credentials like a four-year degree. Even firms that have decided to eliminate four-year degree requirements can still fall into the trap of prioritizing candidates with those degrees, Jones said, citing another example of an employer OneTen worked with. “That was because of a bias, a mindset,” Jones said. “A four-year degree was the gold standard of telling them that this person can learn. It was a real, flawed mindset with respect to that particular credential.” But most companies don’t have a plan for exclusion, Auguste said. They may use hiring technology platforms that screen out non-traditional candidates by default. Such hurdles may require employers to check with their providers or otherwise perform additional analysis of screened candidates on the back end, said Emily Dickens, chief of staff, head of government affairs and corporate secretary for the Society for Human Resource Management. On the candidate side, Auguste said underrepresented groups of candidates “are more likely to read your job descriptions and say, ‘I don’t have that,’” which, he noted, is another reason why employers should “take the job description aspect of this seriously.” HR also may need to address hesitancy on the part of organizations to hire STARs. “If someone comes with 12 different reasons [not to hire STARs], there’s frankly something wrong,” Auguste said. As employers welcome more non-traditional candidates into their workforces and set them up to succeed, that risk aversion decreases over time, he added; “the successes pile up.” ‘These are all the things businesses say they need’ The pandemic has seen a number of employees making career changes from front-line roles in sectors such as the care economy and call centers to those in information technology, cybersecurity and other high-demand areas, Auguste said. That movement, he noted, is a testament to the resiliency and curiosity of these workers. “When you look at what essential workers have done in the pandemic … believe your eyes,” Auguste said. “That’s skills. That’s resourcefulness. These are all the things that businesses say they need.” However, panelists emphasized the need for alignment between HR executives, people managers and the C-suite. “It has to come from the