More Americans have quit their jobs in the past three months than at any time since 2008, according to two reports on U.S. employment released recently. This trend could be important to the Federal Reserve in its decision on an interest rate hike. Nearly 2.8 million workers left their jobs in March - the largest number since April 2008, according to the Job Openings and Labor Turnover Survey released by the U.S. Bureau of Labor Statistics late on Tuesday.
In addition, the three-month quit rate for non-government jobs rose to 6.6 percent, according to research from the Chicago Federal Reserve Bank published in May, the highest such rate since 2008. Rises in wages and inflation are two key factors, Federal Reserve governor Janet Yellen has said, in the determination of when to raise interest rates.
Yellen has targeted a 3 percent wage rise as a condition for an interest rate hike. As the Chicago Fed research noted, wage growth follows inevitably as labor conditions tighten. With more Americans choosing to leave their jobs in search of better opportunities, wage offers are expected to rise. In fact, the Employment Cost Index was up 2.6 percent in March, according to the release from the Bureau of Labor Statistics on April 30. While, according to a Bureau of Labor Statistics job openings and labor turnover survey, domestic job openings have dipped down from more than 5.1 million in February to just shy of 5 million, March still held about 800,000 more open positions than it did a year ago.