Money Rehab with Nicole Lapin - Here’s Why Millions of Americans are Quitting Their Jobs
Episode Date: January 12, 2022Today, Nicole breaks down what’s causing the so-called “Great Resignation,” how it’s affecting industries, and whether you should join the bandwagon and quit your job right now. Learn more ...about your ad-choices at https://www.iheartpodcastnetwork.comSee omnystudio.com/listener for privacy information.
Transcript
Discussion (0)
Money rehabbers, you get it. When you're trying to have it all, you end up doing a lot of juggling.
You have to balance your work, your friends, and everything in between.
So when it comes to your finances, the last thing you need is more juggling.
That's where Bank of America steps in. With Bank of America, you can manage your banking,
borrowing, and even investing all in one place. Their digital tools bring everything together
under one roof, giving you a clear view of your finances whenever you need it.
Plus, with Bank
of America's wealth of expert guidance available at any time, you can feel confident that your
money is working as hard as you do. So why overcomplicate your money? Keep it simple with
Bank of America, your one-stop shop for everything you need today and the goals you're working toward
tomorrow. To get started, visit bofa.com slash newprosmedia. That's b-o-f-a dot com slash n-e-w pros p-r-o-s media.
bfa.com slash newprosmedia. Hey guys, are you ready for some money rehab?
Wall Street has been completely upended by an unlikely player, GameStop.
And should I have a 401k? You don't do it?
No, I never will.
You think the whole world revolves around you and your money.
Well, it doesn't.
Charge for wasting our time.
I will take a check.
Like an old school check.
You recognize her from anchoring on CNN, CNBC, and Bloomberg.
The only financial expert you don't need a dictionary to understand.
Nicole Lappin.
There is a phenomenon in the U.S. that industry leaders are calling the Great Resignation.
According to the U.S. Bureau of Labor Statistics,
4 million Americans quit their jobs in July,
and another 4.3 million Americans quit their jobs in July and another 4.3 million Americans quit their jobs
in August. Even months later, in present day January 2022, the waves of people leaving their
jobs don't seem to be letting up. It's a big topic in the news cycle recently, so I want to dedicate
today's episode to breaking down why this great resignation is happening,
how it's affecting industries, and whether you should join the bandwagon and just quit your job now. There are many different hypotheses about why the great resignation is happening now. I do want
to clear up one common misconception, though, which is that the great resignation has been caused mostly by young millennials
grasping onto big dreams and quitting their jobs to be TikTok famous. That's actually not what's
happening here. According to the Harvard Business Review, employees between 30 and 45 years old
had the greatest increase in resignation rates, with an average increase of more than 20% between 2020 and 2021.
While turnover is typically highest among younger employees, the Harvard Business Review found that
over the last year, resignations actually decreased for workers in the 20 to 25 age range,
likely due to a combination of their greater financial uncertainty and reduced demand for entry-level workers. So why have people been leaving their jobs?
Some experts think that because the last two years of the pandemic have been rife with job
uncertainty, workers didn't feel like they could leave their jobs until now. These experts think
that all of the resignations we're
seeing now are just the built-up decisions that have been put off for the last two years.
Others think that migration is to blame. During the pandemic, tons of people picked up and moved
from densely populated cities to smaller towns in order to avoid COVID hotspots. Some of these folks
left their jobs behind in their moves
with the hopes of finding something local in their new neighborhood. Another big factor has been
child care. When schools shut down, some parents and guardians needed to step away from their work
to become their child's full-time teacher. The most political argument is that resignations
have been heightened by an
increase in active government-supported financial programs, like the stimulus checks and the student
loan moratorium, which was just extended once again, as well as unemployment programs. These
programs may have taken some financial pressure off employees and given them more flexibility to leave their jobs. Recently, researchers have been interested in exploring whether the apocalyptic doomsday
vibes the pandemic brought on has made people feel like it's time to reshape their lives and
follow their dreams. Because who knows when the world might end, right? Or it may be just as simple
as people are feeling exhausted after long work hours during a
global pandemic and frustrated at slashed benefits. Truthfully, I think all of these hypotheses have
merit. And realistically, the great resignation is a result of all of these factors taken together.
Now that we've explored the why, I want to explore the what, or more
specifically, what are the long-term effects of the Great Resignation? Well, the short story is
that it's likely good news for workers and less good news for consumers. With the low supply of
and high demand for labor, workers have had more leverage when asking for what they want.
And it's working. Companies like Target and Sonic are amending employee benefits packages
based on demands from employees. According to The Atlantic, wages for low-income workers are
rising at the fastest rate since the Great Recession. And according to The New York Times,
the share of job postings on ZipRecruiter offering retirement plans is up 30% since
before the pandemic. Jobs advertising flexible scheduling grew threefold, and the portion
offering signing bonuses went from 2% to 12%. The New York Times calls the great resignation a
nationwide labor strike, which I think is a perfect comparison. Just like a strike with the national
labor shortage, employees have more power to call the shots and ask for the benefits they want and
deserve. And if they don't get them, they can quit and go through the zillions of
companies with job openings right now and find the one that will give them the benefits they're
asking for. This is all great news, but there is some not so great news. With more and more people
leaving their jobs, there will be and has already been disruptions for consumers. In the travel
sector, we've already seen widespread
cancellations of flights, trains, and buses because there aren't enough workers to literally
keep the trains running on time. But that's a story for tomorrow's episode. It's also possible
that with companies meeting employees' demands for better benefits, they will increase their
prices in order to compensate for the cost of
the new benefits they're giving their employees. It's a drag, but we should adjust our spending
plan to factor in the likelihood that we'll likely be paying more for everyday expenses.
So here's the last question you might be asking. Should you quit your job? To be honest,
I don't have a one-size-fits-all answer. I will never
tell you to suffer through a job that's costing you emotionally more than it's paying you
financially. And of course, I left CNBC in order to work for myself, so I was part of the resignation
movement, I guess, before it was cool. But I'm a little bit conflicted here. As I mentioned earlier,
millennials are not the
core group of folks who are leaving their jobs. And yet I do hear from a lot of young millennials
who are leaving their jobs to become influencers, motivational speakers, or self-employed dolphin
trainers. I think within the great resigners, there are two groups. There are people who have worked their way up and are ready to
claim their spot at a higher rung in the ladder, and there are people who don't want to climb.
In other words, in this world where the work hard, play hard startup mentality is so glorified,
I see a lot of young people rejecting the idea of taking an entry-level job or a role that is
anything less than their
dream job. Do you remember in school when you had to work on a group project and you hated it,
but your teacher told you that it would help you develop skills you'd use later in life?
That's how I feel about working an entry-level job. It's not sexy, but it's important. That job that helps you get your foot in the door
or whatever it is will teach you things that you can reference when you do reach the top of your
career ladder years from now. And yes, I know myself. I put in the time working jobs that
I didn't love in order to pay the bills. And so I think of that
experience as a rite of passage. I know other people with more luck or privilege get to skip
that step. But I feel deep in my bones that by skipping steps, you skip lessons. And I wouldn't
trade my life lessons for anything.
So with that said, here's today's tip you can take straight to the bank.
Before you quit your job and burn your corporate bra, ask for a raise or a bump in overall comp. With the cards being stacked in the employee's favor right now, you can reap the benefits of
the great resignation, like having more leverage to get what
you want, while also reaping the benefits of being employed.
Money Rehab is a production of iHeartRadio. I'm your host, Nicole Lappin. Our producers are
Morgan Lavoie and Mike Coscarelli. Executive producers are Nikki Etor and Will Pearson. Our mascots are Penny and Mimsy.
Huge thanks to OG Money Rehab team,
Michelle Lanz for her development work,
Catherine Law for her production and writing magic,
and Brandon Dickert for his editing,
engineering, and sound design.
And as always, thanks to you
for finally investing in yourself
so that you can get it together and get it all.