Americans Quitting Jobs Decline as Labor Market Cools Amidst Fed Rate Hike

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The surge in Americans quitting their jobs, which peaked during the pandemic, has subsided, indicating a cooling labor market as the Federal Reserve raises interest rates. In April, 3.8 million Americans voluntarily left their jobs, a decrease of 700,000 from 4.5 million in November 2021. The quits rate, which measures the number of resignations as a share of total employment, dropped to 2.4% in spring, approaching pre-pandemic levels. The decline in voluntary job departures indicates a softer labor market with reduced employer demand or employees being content with their current jobs. As the labor market cools, weekly applications for unemployment benefits have risen, the unemployment rate has increased, and the average number of hours worked per week has fallen. Meanwhile, companies are finding it easier to hire workers, and economists project a smaller job gain in June compared to previous months.