Three charts show how the U.S. labor market is shifting: the quit rate is flat, Black unemployment is rising, and regional job turnover is diverging.
Gas is up. Rent is up. Groceries? Definitely up. But job hopping? Not so much. As prices climb and paychecks shrink, one quiet metric refuses to budge: the quit rate, which tracks the share of workers voluntarily leaving their jobs each month. It has been stuck at 2% for the fourth consecutive month and has hovered below pre-pandemic levels throughout 2025, signaling a cyclical slowdown in the labor market. Despite a relatively benign unemployment rate of 4.3%, other indicators, including rising joblessness among younger and Black workers, point to a more fragile environment.
That stagnation points to a deeper trend: Workers lack confidence in finding better opportunities, so they stay put.
“The quit rate shows less turnover and fewer opportunities for workers seeking better jobs,” said Bill Adams, chief economist at Comerica Bank. He described the late-2025 labor market as a relatively secure environment for those already employed but difficult for people trying to enter the workforce or change jobs.
Structural Labor Gaps
The unemployment rate for Black Americans rose to 7.5% in August, climbing 1.5 points in just three months, the fastest increase since 2020 and an unusual spike outside of a recession. That left Black workers with double the jobless rate of white Americans, reversing some of the gains made in narrowing the racial unemployment gap over the past three years.
“Black unemployment tends to rise ahead of recessions and by more than the overall rate during downturns,” Adams said. “It’s one of the most cyclical indicators in the labor market.”
He pointed to the August spike as a warning sign, adding that unemployment is also rising among younger workers. “We’re seeing fewer work-permit applications from foreign labor, too,” he said. “That’s another signal of weakening labor force growth.”
Regional Job Trends Split
U.S. quit rates remained uneven in July, with the South reporting 1.32 million quits, more than twice the Northeast’s total. The South’s quit rate rose to 2.2%, while the Midwest and West held at 2%. The Northeast dipped to 1.6%.
“The South has a younger workforce, so job tenure tends to be shorter,” Adams said.
Compared with a year earlier, quit rates fell across all regions, signaling a broader slowdown in job switching despite persistent geographic gaps.
The Fed’s recent quarter-point rate cut to 4% from 4.25% reflects concern about the labor market cooling, even as inflation remains elevated.
“Quits often lag recoveries,” Adams said, noting the broader job market could rebound before quit rates do. Fiscal stimulus from the tax-and-spending bill passed in July is expected to boost hiring in 2026.
“Right now, it’s a slow-hiring, slow-quits economy,” he said.
