Why 2020 Will Be the Year of Job Switching (and What It Means for You)
The unemployment rate is extremely low, which means people are switching jobs more frequently for opportunities that better fit their needs.
Switching jobs in a strong economy can give you more negotiating power.
Employers are hiring already-employed candidates at a higher rate than unemployed candidates.
Job switchers often change industries, but not at a higher rate than usual.
Job hopping doesn’t always look bad on your resume (and, in some instances, can even help increase your hireability).
Have you been considering leaving your current employer for another opportunity? If so, you’re not alone. In recent years, the job switching rate has nearly doubled from 2.3% during the Great Recession to a whopping 4% at the beginning of 2018, according to data from Indeed Hiring Lab. This means many employed professionals are choosing to take roles with a different employer rather than seeking job growth within their current organization. And, in many cases, US job seekers are changing industries, too.
Along with a half-century of low unemployment rate and rising wages, the increase in job switching indicates a strengthening job market—which comes as welcome news after years of uncertainty. But, what's the case for job switching, which industries experience it most, and what does it take to switch from one employer to another successfully?
Here’s what you need to know.
Why is job switching on the rise?
Right now is an excellent time to look for a new job. The unemployment rate in October 2019 was 3.6%—a significant drop from its peak high of 10% during the Great Recession in October 2009, according to data from the Bureau of Labor Statistics.¹
And in a November 2019 poll of over 100 active job seekers, more than 77% said they felt there were more jobs available today than there were ten years ago. In stark contrast with job market conditions only a decade ago, many people are discovering it’s easier to find opportunities that better align with their salary expectations and career trajectory.
In April 2019, after spending a year abroad, Omar Rodriguez, a claim representative based in Austin, TX, had an opportunity to return to his former employer, a large insurance company. Instead, he decided to accept an offer at a small startup where he has more opportunity to grow.
“It’s definitely easier to look for and switch jobs now than it ever has been,” he said. “Much easier than when I graduated from college [in 2011] and the economy was still recovering from the recession.” Meanwhile, thanks to increasing competition for skilled professionals, employers are having a harder time recruiting and retaining top talent.
In other words, during times of weak economic growth, like in 2009, people are more likely to stay with their current employers for fear of instability or a lack of openings within their industry. But when the job market tightens—as it is now—job switching becomes more common. Those who previously felt “stuck” in less-than-ideal roles with little upward mobility, low wages, toxic cultures, or lengthy commutes now feel comfortable exploring other options.
Furthermore, because it’s more difficult for employers to attract and hire qualified candidates in a healthy job market, they’re more likely to seek out qualified workers directly. Even if someone isn’t actively searching for a new job, they may consider switching if another employer approaches them with an attractive opportunity.
As the unemployment rate shrinks, so do the number of jobless candidates. To meet their needs, employers have to look elsewhere. This, in turn, increases the number of already-employed workers changing jobs. More than 75% of job seekers said they’ve been approached by another employer while they were already employed—and 99% said they would be willing to take an interview if another employer approached them.
In short, the healthier the market, the more frequently people switch jobs.
Read more: How to Change Careers
What are the benefits of changing jobs?
There are several reasons you might choose to pursue an opportunity with a different employer. And while competition varies between job types and industries, a stronger job market generally means you’ll have a better advantage when it comes time to negotiate an offer.
1. Better job offers
To bring in the talent they need, many employers are open to increasing pay, improving benefits and even loosening job requirements such as years of experience or level of education.
2. More opportunities
Because the number of new hires with less than a college degree has increased, you may also be better positioned to earn roles that traditionally have higher barriers to entry in weaker economic conditions.
3. Increased earning potential
In many cases, job switching is an excellent time to increase your earning potential. Or, if you’re open to remaining with your current employer, the hiring boom and growing competition can strengthen your bargaining power when asking for a raise or promotion.
Of course, many workers also switch jobs for reasons other than earning more money. When asked about their reasons for job switching, 49% of respondents selected reasons unrelated to salary, including:
Upward mobility (14.5%)
Escaping a toxic work culture or bad boss (14.5%)
Exploring a new industry (6.4%)
Easier commute (4.5%)
“Although I’m making a lower salary than I would have been able to negotiate at my old job, the benefits of a flexible schedule, professional growth, and a happy work environment definitely outweighed a higher salary,” Rodriguez said.
Taking an opportunity in a different industry
When people change employers, they may also change industries. Especially today, when many roles span a variety of industries. For example, an IT professional who works for a retail company may switch employers and work in IT for the non-profit sector instead. Similarly, an accountant may leave a technology brand and accept a job in accounting with a healthcare company.
And in some scenarios, transferring to a new industry isn’t even intentional, which was the case for Rachel Haberman, a content marketing manager in Boston, MA. After realizing her role at a marketing and advertising startup wasn’t the right fit, she accepted an opportunity with a large software company.
“I am still working in content marketing, but in a new industry and at a much larger company,” Haberman says. “My decision to make the move had more to do with joining a larger team where I had a better-defined role than it had to do with switching industries.”
However, there are some exceptions. In education and health services, for example, 60% of people stay within their industry when switching jobs. That’s because the skills and experience within these industries are highly specialized and can’t be easily transferred to other verticals.
It’s important to note, however, not all industries hire already employed workers at the same rate. For example, 65% of new hires in the mining, quarrying, and oil and gas extraction industry left their employers another job. Meanwhile, only 34% of new hires in arts, entertainment, and recreation were job switchers—which could suggest there’s stronger competition for talent in the first category than the latter.
Additionally, while some unemployed job seekers may worry their joblessness could affect their chances of being hired, data suggests that trend is changing ahead of 2020, too. More than 50% of hires across five industries were out of work for at least three months before landing their new jobs.
Does job switching affect employment potential?
In past generations, people who otherwise would have switched jobs instead chose to stay with their current employer because they assumed too much job-hopping on a resume could make them appear fickle or disloyal. However, as Millennials become the workforce majority and take on more leadership roles, and Gen Z enters the labor force, perceptions about job-hopping are rapidly changing.
“I came out of school with this idea that frequent job switching had a negative connotation,” says Haberman. “And that hasn't panned out in my actual job experience.”
Angela Loeb, founder of career development consulting firm, InSync Resources, agrees.
“Several people I work with in younger generations look at job-hopping from an opposite point of view,” Loeb says. “They see it as, ‘If you haven’t moved around and tried new things or tried to progress your career, then how are you exposing yourself to different projects, different company cultures, and enhancing your skills?’”
In industries and occupations where there’s more demand for specialized talent, like technology, regularly switching jobs has almost become a norm. Taking new opportunities can help workers consistently grow their skill sets, acquire more experience, make more money, and expand their areas of expertise.
But whether you’ve been with the same company for several years, or you’ve made a lot of moves, it’s important to illustrate your career progression.
“It’s important to show variety, even if you’ve only been with one company,” Loeb says.
Pro-tip: When discussing previous roles with a potential employer, it’s crucial you demonstrate the positive aspects of job switching. If you haven’t moved around much, highlight growth and change within your roles and responsibilities. In either case, be sure to discuss specific skills you gained and why your varied experience makes you more hireable.
Also, if you decide to switch jobs, make sure you always leave on good terms with your previous employer. Any instances of unprofessional departures can be a red flag to potential employers.
Job switching tips for the year ahead
There’s no doubt 2020 is shaping up to be an excellent year for changing jobs and taking the next step in your career. Here are several tips to keep in mind before you embark on your job switching journey:
1. Think through your long-term career goals
Before you make any decisions, take time to consider your career path and ideal destination. It can seem appealing to jump on the first new opportunity that crosses your path—especially in an unpleasant work environment or with little upward mobility.
“Make sure the move will help you get closer to your career goal,” Loeb says. “Otherwise, you might put yourself in an equally bad, or worse, situation.”
2. Be patient
Many factors can impact your job search timeline, and some of them have nothing to do with your skillset, experience or hireability. The time of year and level of competition within your profession can affect how quickly you hear back. Don’t become discouraged if you aren’t hired immediately, and try not to take rejections personally.
If you’re in the job market for several weeks without a response, you may want to review your resume to ensure you’re aligning your professional history and experience with employers’ needs.
3. Invest in education and training to set yourself apart
An advanced degree or additional certifications shows employers you’re dedicated to improving yourself and advancing within your industry. This is especially important if you’re trying to break into a new industry where you’re up against candidates with more relevant experience. It can also help you meet people in your field of interest who might be able to help you get a foot in the door.
4. Consider your network
Your personal and professional network is one of your most valuable resources when you enter the job market. Before you begin your job search, identify people who can introduce you to employers you’re interested in working for, provide referrals to help increase your chances of earning an interview or even offer mentorship.
5. Identify and highlight transferable knowledge and skills
Before you apply to a job opening, determine which skills and experience from your current job align best with the requirements listed for the new role. Highlight those items on your resume and in your interviews.
“Don’t just provide a biography of your background,” Loeb says. “Pick and choose the information that’s relevant to the position you’re considering.”
6. Weigh the risks and benefits
Leaving one job for another can have plenty of advantages, but you may experience a few drawbacks, too. Acknowledge and prepare for any changes between the two positions. For example, while you may earn a higher salary with a new employer, you’ll likely also have to adjust to a new culture and different processes.
Consider your commute, schedule, benefits, and other details important to you. You should also be financially prepared for any gaps in employment when transitioning from one company to another.
7. Don’t burn bridges
Unprofessional behavior can impact future opportunities. You never know when you’ll need to reach out to a former colleague for a recommendation or work with the same people at a new company. Additionally, you may quickly recognize your new job is not a good fit, and want to return to your previous employer, which was the case for Krystyna Schmitt, a client success professional based in Gulfport, MS.
In mid-2019, Schmitt left her job to explore an opportunity in the region’s booming hospitality industry. After a few months, she realized her new employer’s lack of flexibility was negatively impacting her work-life balance. After contacting her previous employer, the company offered her a remote position, which she started in November.
“I think once a company knows who you are and what you can do, that it’s easier to get back in,” she says. “Which is why leaving on good terms is a must.”
Taking the next step
Determining whether to stay with your current employer or pursue an outside opportunity is rarely a straightforward decision. In many cases, there are many factors you’ll need to weigh before you come to an informed conclusion.
However, with a strong economy and new opportunities available across a wide range of industries, this may be the best time to make the leap. So long as you take a strategic and thoughtful approach, switching jobs can help you advance your career while enjoying many other perks and advantages.
¹ Labor Force Statistics from the Current Population Survey, Bureau of Labor Statistics, November 2019