Which States Are Seeing The Most Quits Amidst The Great Resignation?

The U.S. economy has been gradually recovering from the devastation wrought by the COVID-19 pandemic. Wages are up, unemployment is at pre-pandemic lows and the number of job openings available today is high.

But the recovery has been uneven and the country as a whole is suffering from a labor shortage known as the "Great Resignation," as millions of Americans have quit their jobs. As one example of this, the Department of Labor reported that the number of quits increased by 152,000 in March, bringing the total to about 4.5 million and bringing the quit rate to 3.0%.

In a new analysis by credit-scoring website Wallethub, a ranking was compiled of resignation rates across the 50 states and the District of Columbia. Among them, Alaska stood at the top of the list with a 4.10% resignation rate in the last year. It was followed by Florida (3.20%), Arizona (3.33%), South Carolina ( 3.43%) and Georgia (3.79%).

The state with the lowest resignation was New York which had a resignation rate of 1.95%. It was followed by the District of Columbia (2.03%), Connecticut (2.24%), Massachusetts (2.28%) and Pennsylvania (2.24%).

Wallethub's findings correspond well with findings by the Bureau of Labor Statistics, which noted the geographic discrepancies in resignation rates. According to BLS, the South counted the highest resignation rate in the country at 3.4%, compared to the Northeast ranked the lowest at 2.2%.

Why some states are experiencing higher resignation rates than others has to do with the nature of the economies in each of them.

John Winters, a professor at Iowa State University and a Wallethub expert, said that inflation and its impact on wages could be a contributing factor. Inflation has risen to levels not seen since at least 1982 and not every employer has been able to adjust their wages to it, leading workers to look elsewhere for better options.

"Workers will naturally shift toward those offering higher wages and leave those where real wages (wages adjusted for inflation) are falling," said Winters.

Another factor that could in part explain discrepancies could have to do with how each may have been impacted by the COVID-19 pandemic, Dr. Anthony Wheeler, Dean of Widener University's School of Business, told Yahoo Finance.

"We know that the retail sector has been hardest hit with quit rates; but the level of quit rates isn’t the same in other industries or job categories," said Wheeler. "For the harder hit industries, quit rates happened in specific contexts. Some jobs required in-person contact under quite stressful dynamics. This leads to increased stress and burnout."

This trend was noted in a previous Wallethub study, which found that some states saw some of the larger sectors of their economies post strong job growth as businesses reopened.