Geo-Economics and Politics

Why are Americans still quitting their jobs? 5 economic stories to read this week

The state of Russia's economy, America's student debt crisis and the future for inflation - these are the latest economic stories.

The state of Russia's economy, America's student debt crisis and the future for inflation - these are the latest economic stories. Image: Unsplash/Eric Prouzet

Tom Crowfoot
Writer, Forum Agenda
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  • This weekly round-up brings you key economic stories from Agenda from the past seven days.
  • Top stories: America's Great Resignation; Russian economy; Central bank digital currencies; America's student debt; Is inflation here to stay?

1. Why are Americans still quitting their jobs?

The COVID-19 pandemic led many people from around the world to reevaluate their work, priorities, and whether they are willing to put up with conditions that they accepted prior to the pandemic.

In July 2022, 4.18 million Americans left their jobs, leaving many employers struggling to fill vacancies, particularly in low-wage sectors.

But, while the number of Americans quitting their job is still historically high, it isn't showing signs of slowing.

Great Resignation America economy
At 4.18 million, the number of Americans leaving their jobs remained historically high. Image: Statista

Learn more about the Great Resignation in America.

2. Six months into the war, what is the state of Russia's economy?

When Russia invaded Ukraine six months ago, the West responded with tough economic sanctions. Despite predictions that the Russian economy would shrink by 12% this year, the economy ministry is now predicting a 4.2% contraction.

The unemployment rate was 3.9% in June - its lowest since the statistics service started publishing the figure in 1992 - according to the Eikon database. President Putin has also ordered a 10% rise in pensions and the minimum wage to soften the impacts of inflation.

Emergency capital controls have helped the rouble firm more than 25% this year, making it the world's best-performing currency so far in 2022.

Read more about the Russian economy and how its citizens are faring.

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3. What are central bank digital currencies?

Central bank digital currencies (CBDCs) are digital versions of a country's physical currency. They are issued by central banks, the authority in charge of overseeing a country’s currency, supply of money and monetary policy – like setting interest rates.

The uptake of digital currencies reflects a global shift away from cash. By making money easier and safer to access, CBDCs could potentially improve financial inclusion, says the Atlantic Council.

A graphic showing the features and benefits of digitalising the Euro for the European economy.
Features and benefits of digitalising the Euro for the European economy. Image: European Central Bank

More than 100 countries are exploring CBDCs, with ten countries having already launched their own. Jamaica introduced its JAM-DEX digital currency this year and expects savings of around $7 million a year on replacing, storing and handling cash, according to the Atlantic Council’s CBDC tracker tool.

Explore the benefits of CBDCs and which countries are using them.

Discover

What is the Forum doing to improve the global banking system?

4. Americans owe $1.75 trillion in student debt

According to the Federal Reserve, the level of outstanding student debt in the United States hit $1.75 trillion at the end of 2021. However, US President Joe Biden is set to cancel $10,000 of student debt for millions of Americans and as much as $20,000 for low- and middle-income groups who have received a Pell grant in the past.

"Canceling student debt is one of the most powerful ways to address racial and economic equity issues," according to lawmakers in a letter to the President earlier this year.

A chart showing how student debt in the US economy has risen steadily since 2006.
Student debt has continued to rise in the US economy. Image: Statista

Find out more about the state of American student debt.

5. Inflation: why it’s very unlikely to get back below 2% for years to come

The UK and Eurozone have been plagued by record inflation rises in the past few months, with UK prices rising by 10.1% in July compared to a year earlier. The Bank of England predicts that inflation will peak at over 13% later in the year, only returning to the 2% target level within two years.

inflation UK Europe US economy
Inflation in the UK, Europe and the US from October 2021 to July 2022. Image: Trading Economics

But in this opinion piece, two economists argue that a return to 2% levels of inflation might be further off.

Find out why and the factors they think will continue to drive high inflation for the foreseeable.

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The views expressed in this article are those of the author alone and not the World Economic Forum.

Related topics:
Geo-Economics and PoliticsEconomic GrowthFinancial and Monetary Systems
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