The quit rate is the most informative labour market statistic that almost nobody outside economics watches. It measures something no other series captures: whether workers believe they can do better elsewhere.
What it measures
Voluntary resignations as a percentage of total employment, per month. Crucially, it excludes redundancies and dismissals - it counts only people who chose to leave.
That makes it a direct measure of worker confidence. People do not resign without a reasonable belief they can find something else.
Where to find it: the US JOLTS release publishes a clean monthly quits rate. The UK does not publish an exact equivalent, but ONS labour market flows, job-to-job move estimates and resignation data serve the same purpose.
Why it matters more than it appears to
Here is the mechanism that makes the quit rate so important: most vacancies exist because someone left.
When quits fall, the chain of replacement hiring stops. Person A does not resign, so their role never opens, so person B never gets that job, so B's role never opens either. A single decision not to move removes several potential vacancies from the market.
This is why a low-quit market feels so completely stuck to anyone trying to enter or move, even when redundancies are low and unemployment looks healthy. The jobs are not being destroyed - they are simply never becoming available.
How to read the levels
- High and rising quits: workers confident, plenty of alternatives, employers competing. Good for movers, and typically accompanied by faster wage growth.
- Falling quits: confidence draining. Usually the earliest sign of a slowdown, and it often moves before vacancies do.
- Low and flat quits: a stuck market. People are staying put because they do not believe they can move - the defining feature of a frozen job market.
The wage growth connection
Job-to-job moves have historically delivered larger pay increases than internal rises. When quits are low, that route closes for most people, and aggregate wage growth slows as a result. So the quit rate is also a leading indicator for pay - useful context for salary negotiation.
What it means for your decisions
If you are employed and considering a move: low quits means fewer opportunities but also less internal competition for the ones that exist, because fewer colleagues are looking. It also means your employer has less pressure to retain you with a rise - and more pressure once quits start rising again.
If you are searching: low quits explains why replacement vacancies are scarce. Prioritise roles created by genuine departures or growth over speculative postings.
If you are an employer: low quits looks like good retention and is not. It is deferred turnover. When conditions improve, the people who wanted to leave will, and often in a cluster. Treating a low-quit period as evidence of a healthy culture is a classic misreading - the metric is measuring the market, not you.
The general lesson
The most informative statistic is often not the most reported one. Unemployment gets the headlines; quits tells you what people believe about their own prospects. Knowing which series answers which question is most of the skill.
The Statistics for Business course at London School of Business UK teaches that kind of interpretation. Enquire today.