Quit Rate

The quit rate is the number of employees who leave their jobs voluntarily during a period, expressed as a percentage of total employment. Quits are separations initiated by the worker, as opposed to layoffs and discharges initiated by the employer. Because people usually quit when they are confident of finding something better, the quit rate is widely used as a gauge of worker confidence and of how tight the labor market is.

In the United States the measure comes from the Job Openings and Labor Turnover Survey (JOLTS) run by the Bureau of Labor Statistics (BLS), alongside data on job vacancies, hires and layoffs. Economists, the Federal Reserve and employers watch it because it tends to move ahead of wage growth. Other countries rely on labor force surveys that ask why people left their last job, which give a less timely picture.

Think of a block of flats where tenants can leave whenever they like. If lots of tenants are moving out, it usually means they have found nicer or cheaper places nearby, and the landlord may need to offer a better deal to keep the rest. If almost nobody moves, tenants probably feel there is nowhere better to go.

Workers behave the same way. A high quit rate says many people think they can do better elsewhere, which pushes employers to raise pay. A low quit rate suggests people are holding on to the jobs they have.

JOLTS calculates the quits rate as:

• $Q$ is the number of voluntary quits during the month (retirements are counted separately as "other separations").
• $E$ is total employment for the month.

For example, if 3 million workers quit in a month when 150 million people are employed, the quit rate is 3 ÷ 150 × 100 = 2%. In September 2026 JOLTS recorded about 3.4 million quits, a rate of 2.1%. The record in the series, which starts in December 2000, was about 3.0% in late 2021 and early 2022.

• Job availability. When vacancies are plentiful and unemployment is low, workers expect to find new jobs quickly, so quits rise. They fall sharply in a recession.
• Pay gaps. If other employers are paying more, workers leave to capture the difference. Atlanta Fed wage data have shown that job switchers often get bigger raises than people who stay, especially when quits are high.
• Working conditions. Hours, flexibility such as work from home, management and burnout all influence quitting.
• Sector mix. Quit rates are much higher in hospitality and retail than in government or finance.

Because quits are voluntary, a rising quit rate signals that voluntary and frictional unemployment may be making up more of total joblessness, and that employers are competing for staff. High quits put upward pressure on wages and, through labor costs, on inflation, which is why it features in debates about the Phillips curve, the NAIRU and full employment. Falling quits are often an early sign of a cooling labor market.

The surge in quits in 2021 and 2022 was nicknamed the "Great Resignation". Most of those who quit moved to other jobs rather than leaving the workforce, so economists also called it the "Great Reshuffle". The fall in quits to around 2% by 2024 to 2026 matched a broader cooling in hiring.

The quit rate also connects to labor market flexibility. Movement between jobs lets workers find better uses for their skills, which supports productivity. Where workers are tied to one employer, as in a monopsony, quits and wage growth tend to be lower. Each potential quitter compares outside offers with their current pay, much as job seekers compare offers with their reservation wage.

The JOLTS sample is relatively small and its response rate has fallen, so monthly figures are often revised. A quit does not always mean confidence: some people leave because of illness, caring duties or poor conditions and move into economic inactivity. The quit rate says nothing about where leavers go, so analysts read it alongside hires, layoffs and wage data.

• US Bureau of Labor Statistics: Job Openings and Labor Turnover Survey
• Federal Reserve Bank of Atlanta: Wage Growth Tracker