the money game

Go Get a New Job Now, Before It’s Too Late

Photo: Leonardo Munoz/VIEWpress

After four years at the New York City Department of Education, Humberto Cruz-Chavarria quit his job in July. “I loved my job,” he said, referring to his position as the head of multilingual education in the DOE’s early-childhood education division. But he began to believe that his best financial move would be to get a new job. He saw union fees and out-of-pocket insurance costs eating more of each paycheck, and he was worried that his government salary would not keep up with inflation. (There were intangibles too — he was not a big fan of the new mayor.) His job search paid off: When he started his new position at an education nonprofit, he got a 15 percent bump in pay, along with other benefits and perks that sealed the deal. The ability to work from home meant he wasn’t so anxious about violence on the subway, and he could spend a half-hour or so each morning walking his dog before starting work in the morning. “I feel like I have a comfortable life in New York City,” he told me. “Not only because of my pay increase, but also, my current employer has better benefits than what I got through the City of New York.”

This is what it looks like during the last days of the Great Resignation. Unemployment is near record lows, job openings are near record highs, and wages have been remarkably strong — all good things for employees eyeing a job change. People switching employers now are not only getting higher pay, they’re locking in pandemic-era (and worker-friendly) benefits as companies start to flex their muscle in real ways for the first time since the start of the pandemic. But before long, something will likely have to give. The Federal Reserve is planning to continue slowing the economy — generally not good for the labor market — by jacking up interest rates in an effort to tame inflation. Meanwhile, that same inflation is driving up the cost of living, with no end in sight. This means that the number of available jobs could start to dry up soon, wages could get less competitive, and the balance of power will shift back to the people making hiring decisions and setting salary levels. Which is all to say, anyone considering a job change might want to act fast.

Among the grim legacies of 2022 is that it will be the year that inflation went bonkers. In June, prices were about 9.1 percent higher than they were 12 months before, but even that 40-year-high surge obscured how much more expensive things like gas and groceries were getting. Something else has been happening, too: People started to notice that their friends and colleagues were all getting new jobs and that employers were yielding not only on pay, but on the kinds of benefits that made living and working such a hellish balancing act. “I started looking around and seeing places that were paying better, and also were giving better benefits and letting you have more flexibility — which is the huge thing now that everyone’s looking for,” said Julia Craft, who started her new job in July as a barber at Hairrari in the East Village. Now, not only does she make about 15 to 20 percent more on a slow week than she did than at her last job, she has more flexibility around her shifts.

Amid the good news coming out of the Labor Department last week was this striking stat: About 4 million people had quit their jobs — generally to get another one that pays more or has better benefits. That’s roughly the sixth straight month that statistic has been that high, even as the economy has been edging closer to a possible recession. It makes sense: Considering that the annual inflation has remained above 8 percent, switching jobs is still the best way for most people to boost their income. While the average pay rate has spiked 6.3 percent during the last three months, those who switched their jobs saw a nearly 8 percent bump in their pay during that same period, according to the Federal Reserve Bank of Atlanta. And now still seems to be a good time to do it, with the government reporting an increase in current job openings to about 10.7 million.

Even though the pandemic economy has long been over, with masks coming off and most businesses returning to pre-pandemic normalcy, the psychological effects of the COVID era are still shaping the labor market. What’s the point of staying at a job that can’t make your life look the way you want it to look? “If there wasn’t a pandemic, my loyalty would have made me stay there a little longer,” said Craft, who also works for a music venue in Brooklyn and sells pinned insects to collectors. “After the pandemic and seeing that other part of life, where you can live your life and be comfortable as opposed to constantly chasing money, it really changed my perspective on everything in life.” Look no further than consultant McKinsey to point out that this is a widely held belief. This bears out in different ways: Only about half of New York City office space was occupied in September, according to Comptroller Brad Lander’s office, and subway usage is still well below the post-pandemic peak reached last December, before the Omicron variant of COVID-19 emerged.

There’s a question looming over these ongoing good times for job seekers: How long can it last? LinkedIn data shows that workers are getting more comfortable than ever quitting, with a 10 percent increase in people leaving their jobs after less than a year. And the data shows that practice spreading beyond the service and hotel industry, which had originally driven the Great Resignation. Now, people who work in the arts, tech, and administrative jobs are the ones quitting in droves. Still, the best days for those changing jobs might already be in the rearview mirror. According to the Atlanta Fed, wage gains peaked in July, and though they’re still up around 5 percent, they have been going down for months. “I think we have passed the peak,” Guy Berger, chief economist for LinkedIn, told me. “The question is, how much will it come down before the Fed says we are on track, and maybe even mission accomplished, on what they’re trying to do?”

Go Get a New Job Now, Before It’s Too Late