ALEXANDRIA, Va.—Nearly 1 in 5 prime-age workers (aged 25 to 54) say they plan to leave their job within a year, and 26% say that only plan to stay at their job for one to two years, reports the Wall Street Journal. The historical average for job duration is four years.
Of those who have taken a new job, 64% say their current job pays more than their previous job, with nearly half of the job-switchers saying they received at least an 11% raise. Nearly 9% are now making at least 50% more.
In the convenience and fuel retailing industry, 2021 turnover was 118.8% for full-time store associates and 181.6% for part-time store associates, according to the NACS State of the Industry Compensation Report of 2021 Data. Turnover for store-level managers in 2021 stood at 28%.
Wages for a full-time hourly associate in a convenience store rose to $13.14 in 2021, up 10.5% from 2020, NACS SOI Compensation Report data indicate. Part-time associate wages increased 12.3% to $12.45 an hour. (View the infographic in By the Numbers in the March issue of NACS Magazine.)
The elevated pay for U.S. workers is one factor driving inflation higher, according to the Journal. Twenty-seven percent of economists surveyed by the Journal said that increased wages are the biggest inflationary risk this year. (More economists cited wage growth as the largest risk than the Russia-Ukraine war and supply-chain disruption.)
Annual wage growth was 6% in March, averaged over three months, according to the Federal Reserve Bank of Atlanta’s wage tracker—up from 3.4% a year earlier and above the 3.7% rate in February 2020, before the pandemic, when the unemployment rate was at a 50-year low.
Despite wage growth, consumers are feeling poorer, as the consumer-price index is at 8.5%, which is the highest it’s been in over four decades.
“It’s an incredibly tight labor market, but the problem for workers is that, yes, there is a 5.6% nominal wage growth, and they have a tremendous amount of power at the moment, but at the same time, they see the 8.5% inflation rate, and when combined, they are seeing a negative 2.9% real wage growth,” said John Benson, director at Alix Partners, at the NACS SOI Summit earlier this month.
The quit rate was 2.9% in February, compared with February 2020’s quit rate of 2.3%, and this high rate shows that workers are confident in their job prospects, reports the Journal. Most people who quit in 2021 and didn’t retire are working full or part time.
However, the quit rate seems to be peaking, which could mean the labor market is cooling off; however, according to Alex Domash, a research fellow at Harvard University, rising quits translate into wage gains with a lag, so even if quits plateau in the coming months, wages can keep going up for a period.
“But even at current levels, wage growth is incompatible with the Fed’s inflation target,” said Domash, adding that the current rate implies sustained inflation above 5%.
“Companies facing stiff competition for scarce talent have been prompted to bump up wages, relax job requirements, expand benefits and offer more favorable terms of employment,” said Julia Pollak, chief economist at ZipRecruiter.
Fifty-four percent of job seekers expect their company to counter with higher pay if they threaten to resign, which is up from 43%, and while annual wage growth for the typical job-switcher was 7.1% in March, wage growth for those who stayed at their jobs rose to 5.3%— near the fastest pace since at least 1997.
“The moment an employer is scared people are leaving, it’s going to give pay raises for everybody,” Guy Berger, principal economist for LinkedIn, told the Journal. “So even though the rate for job-stayers is lower, it’s still gone up a ton.”
Verizon recently bumped its minimum pay to $20 an hour for starting employees, but current employees also will receive a raise if they’re not making that amount.
Nearly every company is feeling the effects of the tight labor market. Amazon is reportedly looking to recruit high school graduates to work in its warehouses, and Tyson Foods has expanded its immigration assistance program to help more of its immigrant employees become U.S. citizens, in an effort to recruit and retain workers as the U.S. continues to struggle with labor shortages. Walmart will now pay its truck drivers up to $110,000 in their first year, and the retailer is launching a 12-week program that allows its supply chain associates in certain markets to earn their commercial driver’s license and become long-haul truck drivers for Walmart.
In a recent Convenience Matters podcast, McKinsey and Company experts share why employees leave their jobs, what employers think are the reasons and what it would take to keep employees from quitting. Listen to Convenience Matters podcast episode No. 332 “Is the Great Resignation Over?”
Employers and employees agree, training and continuous education are motivating factors in employee satisfaction and reducing turnover. Learn more on how your organization may take advantage of what NACS eLearning powered by Ready Training Online has to offer.
Considered an essential guide for HR professionals for more than 40 years, the NACS State of the Industry Compensation Report® is the industry’s premier compensation benchmarking report for the convenience channel. The digital report provides the latest data, trends and best practices on compensation, benefits, recruitment and turnover as reported by retail companies.