Americans Quitting Jobs Even as Savings Dry Up, Debt Grows

A rising number of Americans are quitting their jobs even as their savings deplete and personal debt rises.

New data released by the Bureau of Labor Statistics shows the number of job openings in the United States grew unexpectedly during the month of August.

Roughly 9.6 million job openings were listed in August, according to the BLS's monthly Job Openings and Labor Turnover Survey, which was significantly higher than the anticipated 8.8 million openings from July.

Carl Van Horn, the director of the Heldrich Center for Workforce Development at Rutgers University, told Newsweek, "The increase in job quitting is driven by historically low levels of unemployment. The surge in job openings creates opportunities for employed AND unemployed Americans to leave their current jobs and find better jobs that pay more or give them more flexibility for when and where they work."

A large portion of the job openings came from professional and business services, finance and manufacturing, the report found.

This is the first time in three months that job openings actually grew as jobs overall have reached below pre-pandemic levels, according to JOLTS. The numbers reflect the continuing strength of the labor market, with the number of new hires growing to 5.86 million from 5.82 million in July.

The number of workers quitting their jobs also rose from 3.62 million to 3.64 million since July, with layoffs remaining roughly consistent at 1.68 million.

Growing Financial Troubles

The increase in job openings might be surprising to some as Americans increasingly report stress over their finances. Roughly 70 percent of Americans indicated they are dealing with financial pressure amid high inflation and stagnant wages in a new study from CNBC and Momentive.

"People are worried that the money they've saved won't last and are worried they're going to have to lean more on their credit cards and other sources of debt just to get by," Bruce McClary, a senior vice president at the National Foundation for Credit Counseling, told CNBC.

The growing financial stress affects Americans regardless of income level.

Roughly 55 percent of those earning less than $50,000 said they were more stressed than before the pandemic, and 56 percent of those earning between $50,000 and $100,000 said the same. Even in the earners making more than $100,000, 46 percent experienced higher rates of stress regarding money.

Participants in the survey said inflation, economic instability, higher interest rates and a lack of savings were the top reasons for their stress. But other issues, like aging, medical bills and credit card and student loan debt also contributed to the rising anxiety levels.

A growing number of Americans are even dipping into their savings to pay for basic necessities as well. Roughly 53 percent of those with incomes below $50,000 have less than $5,000 in savings, as did 12 percent of those making $100,000 or more.

Altogether, 58 percent of Americans are living paycheck to paycheck, so why are more Americans quitting their jobs?

The Great Resignation

Shortly after the pandemic hit, employers noted an uptick in employees leaving their companies, so much so it was dubbed "The Great Resignation" by many economists.

In 2021, 892,000 food service industry employees quit their jobs alongside 721,000 retail workers and 534,000 health care and social assistance professionals, The Street reported.

Since then, the national quit rate has slowed down, now officially coming in at 2.3 percent for August. But the number of job openings for August indicates Americans are still more willing to leave their jobs than in years past.

However, the number of job vacancies might not reflect the true story behind Americans' massive job departures – instead of accepting the reality of unemployment, a large portion of Americans are in fact leaving their previous jobs for better pay and benefits.

"This isn't about workers walking away and refusing to work," President Joe Biden said when unemployment levels reached below 4 percent for the first time since the pandemic started. "It's about workers able to take a step up to provide for themselves and their families."

Overall, more employees are being hired rather than just quitting, according to the U.S. Chamber of Commerce, which is likely how Americans are able to quit at higher rates without increased concerns over their growing depletion of savings and high debt loads.

The fate of interest rates also largely depends on the shifting job market. A lower number of job vacancies has been one of the key metrics the Federal Reserve cites as necessary in order to lower interest rates after months of continued rate hikes.