The US economy is gradually recovering from the devastation caused by the COVID-19 pandemic. Wages are up, unemployment is at a pre-pandemic low, and the number of job vacancies available today is high.
But the recovery has been uneven, and the country as a whole is suffering from a labor shortage known as the “Great Quit,” as millions of Americans quit their jobs. For example, the Department of Labor reported that the number of quits increased by 152,000 in March, bringing the total to about 4.5 million and bringing the quit rate to 3.0%.
In a new analysis from credit scoring website Wallethub, a ranking was compiled of quit rates in all 50 states and the District of Columbia. Among them, Alaska topped the list with a quit rate of 4.10% over the past year. It was followed by Florida (3.20%), Arizona (3.33%), South Carolina (3.43%) and Georgia (3.79%).
The state with the lowest quit rate was New York, with a quit rate of 1.95%. It was followed by the District of Columbia (2.03%), Connecticut (2.24%), Massachusetts (2.28%) and Pennsylvania (2.24%).
Wallethub’s findings line up well with findings from the Bureau of Labor Statistics, which noted geographic discrepancies in quit rates. According to the BLS, the South had the highest quit rate in the country at 3.4%, while the Northeast ranked lowest at 2.2%.
The reason some states experience higher quit rates than others has to do with the nature of each state’s economies.
John Winters, a professor at Iowa State University and Wallethub expert, said inflation and its impact on wages could be a contributing factor. Inflation reached levels not seen since at least 1982 and not all employers were able to adjust their wages to it, leading workers to look elsewhere for better options.
“Workers will naturally gravitate towards those offering higher wages and leave those where real wages (wages adjusted for inflation) are falling,” Winters said.
Another factor that could partly explain the discrepancies may have to do with how everyone may have been affected by the COVID-19 pandemic, Dr. Anthony Wheeler, dean of Widener University’s School of Business, told Yahoo Finance. .
“We know that the retail sector has been hit hardest by quit rates, but the level of quit rates is not the same in other industries or job categories,” said Wheeler. “For the hardest-hit industries, quit rates occurred in specific settings. Some jobs required face-to-face contact under quite stressful dynamics. This leads to increased stress and burnout.”
This trend was noted in a previous study by Wallethub, which found that some states saw some of the largest sectors in their economies show strong job growth as businesses reopened.