Reserve Bank official says The Great Resignation is a ‘US story’ and Australia is different
The Great Resignation phenomenon that has seen millions overseas quit their jobs is “mostly a United States” story, according to a senior Reserve Bank official who says Australia’s situation is vastly different.
The trend of mass resignations has been playing out in the US and analysts have sounded the alarm that it should pose a “massive scare” for Aussie employers, with workers here predicted to follow suit from March.
However, when asked about the chance of a similar phenomenon unfolding here, RBA assistant governor (economic) Luci Ellis cited Australians’ experience during the pandemic as being “very different” to that of Americans.
Dr Ellis told the Committee for Economic Development of Australia a “greatly reduced” rate of people left their jobs voluntarily last year to switch to another, because people generally held on during uncertain times.
As a result, she expected “a little bit of catch up” through the second half of this year and into next year as those people who held on finally left.
“I don’t think we’re in the same situation as the United States,” Dr Ellis said on Thursday.
“To be honest, this is really mostly a United States story where a lot of what is going on is that frontline workers, people who are relatively lowly paid, have experienced being locked down.
“They didn’t even get furloughed, but they didn’t have JobKeeper - they were put on unemployment benefits.
“So firstly, you’ve got to stitch everything back together.”
Dr Ellis said low pay rates and less support may have prompted some US workers to seek new pastures.
“The very different experience that many lower paid Americans experienced relative to here in Australia in terms of the support they received, and the way we handled the health situation, I think that’s just going to be a very different experience,” she said.
“The wage rates at the lower end in the US are very low and I think a lot of people are saying, ‘Why am I doing this for this rate of pay?’
“That shock leads them to look for something a bit better rather than staying put.
“Whereas in Australia, because of JobKeeper, there wasn’t that immediate shake-out.
“So you don’t have that experience of people being forced to reconsider their status quo, in the same way that Americans were more likely to be laid off rather than kept on in the same circumstances because they didn’t have JobKeeper.”
Behavioural scientist Aaron McEwan from global research and advisory firm Gartner has said some research showed that up to three-in-five Aussies could be looking to change jobs.
He has predicted The Great Resignation will really start to bite in Australia in March, after people have had their Christmas bonuses and recruiting gets into gear.
During the pandemic, 85 per cent of employees globally experienced higher burnout and nearly half reported having worse work/life balance, according to Gartner research released in June.
Originally published as Reserve Bank official says The Great Resignation is a ‘US story’ and Australia is different
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