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This map shows the states where the most Americans quit their jobs in January

Mar 17, 2022, 21:39 IST
Business Insider
Mixetto/Getty Images
  • New government data out Thursday showed which states had the tightest labor markets in January.
  • Alaska had the country's highest quit rate of 4.4%, while New York's 1.9% rate was the lowest.
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The labor shortage is showing no signs of cooling off, and new data shows which states are struggling the most with matching jobs and workers.

Just as the jobs recovery has charged into the new year, the labor market's extreme tightness has also lingered. There were roughly 1.7 job openings for every jobless American in January, and millions of people are still holding off on rejoining the workforce. Quits also remained elevated in January, signaling workers were still taking advantage of intense labor demand and switching jobs.

A new report published by the Bureau of Labor Statistics on Thursday shows exactly where the labor market is tightest. The US quit rate, or the share of workers who quit their jobs, in January was 2.8%, with 4.3 million Americans deciding to leave their jobs that month. Thirty-one states boasted quit rates above that level, according to the Thursday report. Alaska and Georgia touted the country's highest rates of 4.4% and 3.7%, respectively.

New York, meanwhile, had the lowest quit rate of 1.9%. Massachusetts followed with a 2.1% quit rate.

The following map shows how quitting varied across the US:

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Job openings rates also varied dramatically across the US at the start of the year. Maine and New Hampshire tied for the highest rate of 8.8%, while rates sat as low as 5.8% in Washington. With labor force participation still sitting well below pre-crisis levels, states with elevated openings rates could be in for a lengthy imbalance between worker supply and demand.

The following map shows how job openings rates compared across the nation at the start of the year:

High quit rates are often a good sign for the labor market, as workers take advantage of the plethora of job openings to improve their situations. People may be quitting and accepting offers for jobs that are better suited to their lifestyle or can give them what they want out of a job, such as having more work-life balance.

According to a recent Pew Research Center survey, which surveyed people who quit their jobs in 2021, over half of those who quit a job but are still working are getting paid more and reported it's easier to balance work and family.

Still, the persistence of elevated quit rates and elevated job openings is holding the economic recovery back. The lack of a strong participation recovery, with millions of Americans remaining on the sidelines and not looking for work, has forced businesses to meet massive demand with diminished labor supply. That, along with historically strong wage growth, has contributed to inflation over the past several months, Federal Reserve Chair Jerome Powell said in a Wednesday press conference.

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The US isn't yet staring down a vicious wage-price spiral, in which rising pay lifts inflation and vice versa, Powell added. Yet the massive gap between available workers and job openings is something usually seen at the end of an economic cycle, not the beginning of a new one. If the imbalance doesn't improve soon it could leave the still-recovering economy with a new and unusual problem, the Fed chair said.

"That's a very, very tight labor market, to an unhealthy level," Powell said.

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