The Big Stay is finally paying off: Quitting to job-switch is worse for wage growth than sticking it out
Typical year-over-year wage growth for job stayers has surpassed that for those quitting and switching roles. While it's a small gain at this point, you can see in the chart below that it's an extremely rare event and hasn't happened for a sustained period since 2009. Plus, it's a big turnaround from July 2022, when the gap was 8.5% vs. 5.9% in favor of job switchers.
It speaks to how hesitant companies have become to hire; when they do decide to bring someone on board, they don't need to shell out a big raise to seal the deal.
As a result, the white-collar workers who held tight to their jobs have become the sector's upper class: They're benefiting from low layoffs and robust wage growth. For those who both switched during the Great Resignation and have hung on to their new role ever since, that might be an economic double whammy — they cashed in at that higher salary and have been sitting pretty since.
On the other end of the spectrum are white-collar workers who are out of work and looking, at a time when US businesses are hiring at nearly the lowest rate since 2014, excluding an early pandemic plunge.
So you may be wondering: Is it a good time to switch jobs or not?
Cory Stahle, an economist at the Indeed Hiring Lab, sums it up. "If the right job comes up, one that moves you forward in your career and gives you a healthy raise, certainly consider taking it," he said. "If not, there is at least some assurance that staying put still provides decent pay increases right now."
Have a story to share about your job or job search? Reach out to these reporters at mhoff@businessinsider.com and jkaplan@businessinsider.com.
Job stayers are the new white-collar upper class
In contrast to the years of the Great Resignation, when job stayers were leaving money on the table by not hopping to a new company, the Big Stay has finally started paying off for those who are staying put.
In May, white-collar-dominated industries had robust wage growth over the year. Average hourly earnings increased 6% from a year ago in the information sector, which includes broadcasting, telecommunications, and data processing. Professional and business services, such as the management of companies and enterprises, legal services, and computer system design services, had wage growth of about 5%.
According to an analysis from the Federal Reserve Bank of Atlanta, median wage growth for job stayers across all industries has outpaced growth for job switchers since February.
The Big Stay seems here to stay for the time being — white-collar folks aren't leaving their jobs. Even if they're no longer enjoying their work, some see it as better than facing a long stretch of unemployment or an uncertain job market. And, financially, it's paying off.
"There's fewer people coming in, fewer people heading out," Guy Berger, the director of economic research at the Burning Glass Institute, said. "That mix tends to favor established workers who tend to be older and tends to hurt younger people trying to get their foot in the door."
Job seekers are trading down in title and pay
On the other side are the white-collar job seekers. The things that make the market relatively pleasant for job stayers are working against the job seekers: Employers are running leaner in the face of economic uncertainty and would rather rely on the talent they have. Job stayers may be worried about their chances of getting a different job and aren't vacating roles.
"As white-collar industries reverse some of that pandemic hiring and also pull back on hiring amid economic uncertainty, it's getting tougher to find a job," Daniel Zhao, lead economist at Glassdoor, told Business Insider. Glassdoor data last year showed that a growing percentage of workers switching employers were accepting lower-paid roles, especially in tech.
Zhao said that's because, "Many job switchers today were involuntarily laid off, resulting in more workers having to settle for a lower-paying or lower seniority job."
Berger said that in addition to weak hiring leading to fewer opportunities, there are also more people with a college education, which means more competition for jobs.
"It's also possible that in some segments AI is slowing demand for white-collar workers, though I doubt this is as big as some people think," Berger said.
There's some good news in professional and business services, where the hiring rate continues to be strong and has been trending upward, although it's still below its late 2021 high, and the sector has had several monthly net employment losses over the past year. The information sector's hires rate is still low compared to the overall hires rate, but has climbed somewhat. Hiring in financial activities is lower than in the other two traditionally white-collar fields.
Job seekers are already lowering their expectations: The average lowest wage all workers would accept for a new job plummeted from $82,000 in November 2024 to $74,000 in March 2025. Among those with college degrees, it fell from $102,000 to $95,000 in the same period.
And the share of graduates in jobs that don't require a degree ticked up for recent graduates in the first quarter of 2025, indicating that degree holders are overqualified for more roles.
"White-collar industries like finance, tech, and consulting are still appealing, especially for new grads, because of their promise of rapid career growth and high pay," Zhao said. "But that promise of career growth and high pay is becoming less attainable and more exclusive due to the soft hiring environment."
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
2 days ago
- Yahoo
Fed's Bostic Urges Patience Amid Uncertainty, Resilient Economy
(Bloomberg) -- Federal Reserve Bank of Atlanta President Raphael Bostic called for patience amid uncertainty over economic policy and said a wait-and-see approach can help to ensure officials don't have to reverse course on interest rates. NYC Commutes Resume After Midtown Bus Terminal Crash Chaos Struggling Downtowns Are Looking to Lure New Crowds Massachusetts to Follow NYC in Making Landlords Pay Broker Fees Foreign Buyers Swoop on Cape Town Homes, Pricing Out Locals What Gothenburg Got Out of Congestion Pricing 'I believe a period characterized by such widespread uncertainty is no time for significant shifts in monetary policy,' Bostic said Thursday at an event in Frankfurt. 'That is especially the case against the backdrop of a still resilient macroeconomy, which offers space for patience.' Fed officials have held rates steady this year while they wait to see how President Donald Trump's tariffs, along with changes to immigration, taxes and regulation, will affect the economy. Projections released after last month's meeting show a divide over how much officials expect to reduce borrowing costs this year. While 10 policymakers expect to lower rates at least two times in 2025, seven see the Fed holding rates steady all year. The Atlanta Fed chief said earlier this week that the impact of tariff-induced price increases may be incremental, instead of amounting to a one-time jump, which could lead to more persistent inflation. He reiterated that concern on Thursday, saying tariff-related price bumps may be implemented over the course of the next year or more, causing a slow trickle of price increases that could lift inflation expectations. 'If I'm right, then the US economy will likely experience a longer period of elevated inflation readings,' Bostic said. Job Market A stronger-than-forecast jobs report for June, released earlier Thursday by the Bureau of Labor Statistics, lowered market expectations for a July cut. Bostic said Thursday there are signs the labor market is softening, including a slowdown in hiring, but he said the jobs market is not yet deteriorating. 'I believe the committee must await more clarity rather than move in a policy direction that it might need to quickly reverse,' he said, referring to the Federal Open Market Committee. Responding to questions following his remarks, Bostic said higher US government debt levels could eventually have implications for policymakers. He said debt servicing costs could 'crowd out' other activities, which could later affect prices and employment in 'material' ways. Republicans in Congress appear close on Thursday to passing Trump's tax and spending bill. The version that passed the Senate would add nearly $3.3 trillion to US deficits over a decade, according to a new estimate from the nonpartisan Congressional Budget Office. Bostic also said the size of the federal debt could affect monetary policy by moving interest rates. 'To the extent that those things are perceived in financial markets as risk elevators, you could see interest rates move to some extent independent of things that we do,' Bostic said. 'That would be really something that we'd have to think hard about.' --With assistance from Jana Randow. (Updates with additional Bostic comments starting in 10th paragraph.) SNAP Cuts in Big Tax Bill Will Hit a Lot of Trump Voters Too America's Top Consumer-Sentiment Economist Is Worried How to Steal a House China's Homegrown Jewelry Superstar Pistachios Are Everywhere Right Now, Not Just in Dubai Chocolate ©2025 Bloomberg L.P.
Axios
2 days ago
- Axios
Economic uncertainty casts shadow over June's solid jobs report
The American labor market keeps hanging on, even as signs of weakness crop up. Why it matters: Hiring is solid, defying expectations that the worrisome macroeconomic backdrop — huge uncertainty about trade, immigration, and the fiscal outlook — would keep more employers on the sidelines. But Thursday's Bureau of Labor Statistics report stops well short of giving an "all-clear" for the economy. Beyond the headline, labor supply is dwindling and demand for workers is narrowing. These issues could plague the labor market in the months ahead. By the numbers: Employment increased by 147,000 last month, surpassing the gain of 115,000 jobs forecasters anticipated. The unemployment rate edged down a tick to 4.1%. The government revised up payroll figures for April and May, noting that employment in the prior two months was higher by a combined 16,000 than initially forecast. The report showed that 80.7% of the prime-age population — those aged 25-54 — was employed, just 0.2 percentage point shy of the peak seen in this economic cycle. Zoom in: Conditions look less cheery beneath the surface. The private sector added just 74,000 jobs in June, almost half as many as the previous month. Jobs growth was overwhelmingly concentrated in state and local government, with less impressive gains in the most cyclical sectors — that is, those most exposed to the weakening economy. State and local government added 73,000 jobs, offsetting the continued declines in federal government (-7,000) from DOGE-related layoffs. The other big gainer was health care, which added 39,000 jobs. While the number of unemployed Americans fell, the labor force also continued to shrink for the second consecutive month, helping keep downward pressure on the unemployment rate. Another 130,000 workers exited the workforce in June. What they're saying:"There are real weaknesses in the market — including concentrated job gains, slowing wage growth, and falling participation — that have persisted for months, and there are scant signs of those concerns fading anytime soon," Indeed economist Cory Stahle wrote Thursday morning. The big picture: Stahle compared the current labor market to a sturdy tent, but one that is "increasingly held up by fewer poles." Among those poles are structural forces, including a shortage of workers from America's aging population and the immigration crackdown. There is also an "ongoing reluctance among employers so far" to layoff workers in masse, a scarring effect of the pandemic when it was impossible to find and train staff. Yes, but: There are profound economic changes underway that look set to supersede those factors; the adoption of AI is already shifting employers' hiring plans. President Trump is ending the era of free trade, making it more costly for businesses to get goods from overseas — a dynamic that will force a reckoning among companies about their other expenses, including labor.
Fast Company
3 days ago
- Fast Company
The reason why most employees quit (and what leaders can do about it)
In 2022, the wake of the COVID-19 pandemic gave rise the Great Resignation. This trend saw employees around the world leaving their places of work in droves. As a result, employee turnover surged to unprecedented levels. While resignation rates have gradually decreased from their 2022 peak over the past few years, turnover continues to be a major challenge for businesses. Recent research from PwC revealed that a fifth (20%) of employees had considered leaving their role in the past year, rising to a quarter (25%) of employees aged 18–24. Retention is no longer about salary alone. It's about purpose, progression, and organizations seeing them as more than just a job title. Employees want to be at workplaces that offer growth and feedback, and a culture that reflects their values. The good news is that acting now can turn this challenge into a competitive advantage. Here are three actions that leaders can take to improve their retention, building workplaces that people do not want to leave, but rather stay at, grow, and thrive. Listen to your team (and do so more often) To understand and address the cultural challenges that might be causing team members to leave, start by gathering insights through surveys at key moments. That means onboarding, ongoing performance conversations, and exit interviews. These touchpoints offer a window into your employees' experiences. It also reveals their joys and struggles throughout their journey. Leaders need to prioritize consistent, open feedback to show their teams that they value their evolving needs. Annual surveys alone are potentially missing key growth opportunities. Instead, embrace frequent 'pulse' surveys and platforms for ongoing dialogue, creating a space where employees can feel truly heard. Perhaps most importantly, there's no quicker way to find out how team members are really feeling. They need to know that the company hears and accepts them for who they are Additionally, consider moving away from anonymous feedback. While anonymity may feel protective, it can suggest a lack of trust or safety. Building a culture of psychological safety, where team members feel secure sharing openly fosters trust and strengthens bonds. By nurturing this environment, leaders empower honest, heartfelt conversations that uplift their teams and open up the space to heal any existing rifts. Redefine success with people-centric KPIs Performance and adherence to a company's wider purpose matter—but not at the cost of people. To create healthy, thriving workplace cultures, organizations need to strike a fine balance between People, Purpose, and Performance. Organizations that achieve this foster a powerful state where productivity, team efficiency, and incredible engagement come together to create teams that produce and support one another as never before. When KPIs focus exclusively on delivery and deadlines, pressured managers may fall into the trap of neglecting employee well-being and development. Therefore, by prioritizing KPIs that serve the people, rather than solely focusing on the system, leaders demonstrate a commitment to their team's well-being and growth. Smart leaders shift the balance by daring to care for their people and introducing people-first KPIs alongside traditional business metrics. For example, what percentage of employees are in roles that align with their strengths and aspirations? How frequently are managers recognizing and rewarding their team's contributions? Even a simple 'good job' from a manager, delivered with sincerity, goes a long way. Are managers actively developing high-potential individuals so that they're ready for leadership roles? How often are you opening team meetings by checking in with team members and reminding them of why they matter to the project and wider organization? Even simple acts, like regular, sincere recognition, drive engagement. By embedding these behaviors into people-led leadership KPIs, organizations reinforce that organizations don't see people as a cost to manage, but as an asset they need to cultivate. By emphasizing people-centered KPIs, leaders ultimately contribute to the success and performance of the organization, while also creating a shared sense of purpose that inspires team members at all levels, ensuring that everybody wins. What the head office can learn from the shop floor I truly believe that leaders everywhere can learn a lot about people management from taking a step away from the traditional corporate environment and spending more time with their 'on the ground' teams. The best leadership insights often come not from the boardroom but the shop floor. In customer-facing roles—like retail or hospitality—the true health of your culture becomes clear. These environments offer an unfiltered view of how companies really treat, support, and motivate employees. My turning point in this regard came in my years in retail management, when I realized that I needed to break the circle of performance above all else in favor of cultures that allow team members to bring their full selves to work. Leaders who step into these spaces gain firsthand insight into what really drives their people: psychological safety, empathy, development opportunities, and being heard. The fundamentals don't change between corporate and customer-facing roles, but they're often far more visible at the coalface. Spending time with frontline teams also exposes leaders to a more diverse cross-section of their workforce, building empathy and understanding that can shape smarter, more inclusive strategies. People leave cultures rather than companies While some employee attrition is inevitable in business, the truth is that much of it is preventable. When people walk away, it's often from a lack of growth, recognition, or leadership that genuinely cares. Leaders who act with intention have a tremendous opportunity to build powerful, purpose-led workplaces that attract and retain top talent for the long haul.
