Job Switching Declines as Labor Market Cools

Job hopping is slowing down, with the average rate of workers switching jobs dropping to 3% in May from nearly 3.75% in mid-2022, according to a Bank of America Institute report. During the peak of the Great Resignation in July 2022, job switchers saw an annual pay raise of 8.5%, compared to 6.7% for those who stayed in their jobs. This rapid wage growth contributed to high inflation in 2022 and 2023. However, as of May 2024, median pay raises for job hoppers have significantly decreased from over 20% to about 10%, with middle- and higher-income Americans experiencing the largest slowdown, while lower-income Americans still see strong median pay raises from job changes.