Thread by @p_millerd

Since I write about work, many ask me some form of "what do you think about the great resignation?"

I don't really know what to answer. Everyone means something different.

I think what's going on instead might be better described as "The Great Contemplation". Some thoughts 👇

What people mean by the "great resignation usually is one of the following"
- more knowledge workers quitting to do crypto, creator stuff, self-employed
- people quitting without a plan
- people changing jobs for higher salaries
- they haven't thought about what it means

Some of this was happening but the meme of "great resignation" didn't take off until the quits rate spiked throughout 2021: here is what it looked like form April 2020 to September 2021

The media reported things like "record numbers quitting their jobs"

This fit the meme and it took off.

However people are always quitting jobs - its a sign of a strong labor market & economy. But I am guessing people just heard "quitting" and think quitting without another job

An Example:

Hospitality (about 13M people in the US) has the highest quits rate of any industry.

In 2020 it had a massive drop (employment assistance, PPP, lack of jobs likely causes) followed by a massive spike in 2021

But not out of line with trend over past 12 years

Another thing happening: increasing wages from inflation - driven partly by increasing demand in the economy and lack of supply of labor - this means that its often advantageous for workers to change jobs more

As we see in hospitality, wage growth accelerated starting in 2020

But other industries didn't see the dip in 2020

We see that manufacturing, transportation, and education and health didn't see the dip but DID see the spike in quits in 2021.

Can partially be explained by delayed quitting & increasing wages but hard to know fully

White hospitality quits have slowed in 2022, but manufacturing has not. Could be a lag in this industry as labor moves are slowed though.

Yet the quits rate is still quite high and accelerated above trends

What else could explain it? One hypothesis: older boomers quitting...

When I dug into the participation rate I noticed there was a 1-2% drop in the labor force over the past couple years.

The US economy is that it is aging and many from the boomer generation have stayed working longer than previous generations. More here:

https://twitter.com/p_millerd/status/1220728129737707521?s=20&t=UIs4JuJsa9mB_wQCTmK5Ag

The problem with the "great resignation" at the macro level is that if you look at prime age working population, the labor participation rate is almost close to the same it was a pre-pandemic levels (these are workers 25-54)

Which means I had to dig into those older workers

When I looked at the 55+ population it appeared that there was a substantial drop in the labor participation rate. About 1.5%

In the last two years, the population of 55+ population also increased about 2.5M people - at the same time, the # working in that population dropped about 500,000 - which means that the # 55+ working dropped about 3 Million people.

It still may be too soon to tell if this is permanent - some may be temporarily retired, some may have been held out of work by covid precautions etc.

But it does appear the thing I called the "boomer blockade" may have ended - maybe one of the hidden subplots of the last 2 yrs

Just to cover my bases I also checked the 20-24 year old population - and it does appear that the labor participation rate dropped - yet these are almost definitely less permanent change and its only about 500k people

Which leads me to I think a better explanation of the past two years - something I've been calling the "great contemplation"

Which is more of an individual and societal refactoring of work beliefs and common knowledge

I'd define it as three parts

#1 A shift in common knowledge away from the industrial default path script as the best way to orient your life, especially among younger people.

This has already been fading but even among older people who were a bit tied to this script I'm hearing doubts.

#2 An increased acceptance of public conversation about our over-identification as workers and options such as sabbaticals / part-time / remote work.

There is still shame to say you want a break from work but much less than the past

more people are negotiating for time & space

#3 An increased desire among knowledge workers to want to escape their existing success paths. However, many have not yet taken action on this desire due to a lack of obvious socially acceptable alternatives or not being ready yet.

My hypothesis these three trends will continue over the coming decade and will contribute to a refactoring of our collective beliefs about employment and work. Yet at the individual level, which I am most interested in, I think many of these shifts will happen slowly.

I think the better term than the Great Resignation is the Great Reshuffling.

It's the shift to new industries, the shift to new types of talent, the shift to new ways of working.

@jposhaughnessy has been the most thoughtful on this topic

https://twitter.com/jposhaughnessy/status/1538146029060644864?s=20&t=UIs4JuJsa9mB_wQCTmK5Ag

Jim also calls it the "revenge of the nerds" which is about the increased returns to curiosity and ideas in a yper-connected knowledge economy.

Another good thread:

https://twitter.com/InfiniteL88ps/status/1538137705288462339?s=20&t=UIs4JuJsa9mB_wQCTmK5Ag

I wrote about all this in my latest newsletter

boundless.substack.com/p/the-great-co…

Probably the only mainstream journalist covering this well is @DKThomp - always good thoughts from him

https://twitter.com/dkthomp/status/1473313384351285252