One of the most challenging things to tackle is any news headline where the source data isn’t provided. This was the news blurb from LinkedIn:
“Predictions of a “Great Resignation” appear to be coming to pass, with the share of workers leaving jobs at 2.7% in April — the highest level in more than 20 years, says The Wall Street Journal, citing U.S. Labor Department data. The elevated quit rate is a stark contrast to a year ago, when workers were focused on job security during the pandemic. Economists say employee churn is a sign of a healthy labor market and higher worker confidence as people leave for better prospects, even during a still-shaky economic recovery.”
I immediately had questions. I don’t doubt that the topline number is correct, but the real question is, what are the sector movements, and what could they mean for business?
What Does the Data Say?
To dig deeper, we turn to the actual Bureau of Labor Statistics data, helpfully collated by the St. Louis Federal Reserve Bank’s FRED database. Here’s what we see in 2021:
Figure 1. Job quits; numbers are in thousands of people
On an absolute basis, trade, transportaion, and utilities – i.e. people moving stuff around – saw the greatest quits this year so far. Leisure and hospitality came in second, and professional and business services came in third for total number of people; food services came in fourth and hospitality came in fifth.
Why? What’s going on that these sectors are seeing such large numbers of people quitting? The short answer is that all these sectors have been under substantial strain during the pandemic:
- Trade and transportation has been under duress the entire pandemic, and the logistics failures in our supply chains have not made those jobs better.
- Hospitality, food services, and retail are all sectors in which employees have long faced low wages and punishing working conditions, made worse by the general public’s misbehavior.
- And professional services has seen a spike as companies have reopened offices and insisted employees return to physical offices, which in turn has made some employees simply quit.
Hiring and training new employees is expensive. Any time an employee quits, regardless of the level of position, you lose some institutional knowledge. That’s not necessarily always bad – “this is the way we’ve always done it” is an attitude that tends to harm more companies than it helps. But help or harm, changing out personnel is costly and time-consuming.
As a result, expect businesses in the most affected sectors to have higher costs than normal and for a short period of time, reduced productivity. Those companies which have strong, established processes for onboarding and training new employees will fare the best; those who struggle to codify institutional knowledge will feel a greater impact.
From a marketing perspective, keep an eye on the industries with the highest churn. If you do any kind of list-based marketing in those industries, accept that like last year, your list is going to churn more. Your email database will decay faster, your CRM contacts will fall out of date faster. That means you’ll need to work harder to acquire new audiences to replace the audiences you’ve lost, especially if those people are vacating your industry sector entirely.
Especially if you’re in B2B marketing, end the practice of requiring work-only email addresses (i.e. prohibiting people from using Gmail, Hotmail, etc. addresses). Doing so means you lose contact with valuable people the moment they leave their jobs.
From a content marketing perspective, after this new wave of pandemic hiring and quitting recedes, expect a surge in demand for introductory-level content and training as all the new people struggle to get up to speed. While there’s always a background demand for the basics, any time you have a big wave of new hires, there’s always an increased demand for the basics.
Use Economic Data to Plan Marketing
This data, like so much macroeconomic data, is yours for the taking, paid for by the American taxpayer. Use it to your advantage, to plan your marketing, to understand what your audience is likely to do and what challenges they face. Like a gold mine that no one has ever excavated, you sit on data that you could be using. Start digging!
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