Workers are ‘job hugging' or clinging to their positions ‘for dear life': report
The so-called quits rate among US workers slipped to 2.0% in June, far below the 3.0% peak of November 2021, according to the Bureau of Labor Statistics.
Just 3.14 million people quit in June — down from 3.27 million in May — marking a steady return to pre-pandemic lows. By contrast, 4.5 million people quit their jobs in November 2021.
Advertisement
Employees are holding onto jobs 'for dear life,' consultants at Korn Ferry wrote in a report last week that was cited on Monday by CNBC.
4 Many workers are clinging to their jobs 'for dear life' as quitting plunges to the lowest level in years.
kieferpix – stock.adobe.com
In total, about 47.4 million Americans quit their jobs throughout 2021, setting an annual record. As of June, around 19.3 million Americans have voluntarily quit their jobs year-to-date.
Advertisement
'There is this stagnation in the labor market, where the hires, quits and layoff rates are low,' Laura Ullrich, director of economic research in North America at the Indeed Hiring Lab, told CNBC.
'There's just not a lot of movement at all.'
4 The era of job hopping has given way to 'job hugging,' with employees too fearful to leave.
Studio Romantic – stock.adobe.com
That has led to the voluntary quits rate crashing to lows unseen since 2016, outside the first days of the COVID pandemic.
Advertisement
'There's quite a bit of uncertainty in the world — economic, political, global — and I think uncertainty causes people to naturally' remain in a holding pattern, Matt Bohn, an executive search consultant at Korn Ferry, told the Comcast-owned financial news service.
He compared spooked workers to skittish investors sitting on the sidelines, waiting for the right opportunity.
The lack of movement comes as higher interest rates make it more costly for businesses to borrow money and expand operations.
Job growth has slowed sharply in recent months, with the hiring rate plunging to its lowest level in more than a decade, excluding early pandemic days.
Advertisement
4 Rising uncertainty has left many workers paralyzed about their prospects for a new role.
fizkes – stock.adobe.com
More CEOs now plan to shrink their workforce over the next 12 months than expand it — the first time that's happened since 2020, according to a recent survey. A Conference Board poll published this month found 34% of executives planning cuts versus just 27% expecting to hire.
The dramatic shift from the great resignation to the great stay reflects a labor market that's essentially frozen solid.
Workers who couldn't stop quitting two years ago now won't budge.
But this death grip on current jobs carries serious risks, experts warned.
Job huggers are sacrificing cash because those who switch typically command higher wages than those who stay put, Ullrich noted.
4 Young entrants and recent graduates face an especially tough time breaking into the frozen job market.
Andrey Popov – stock.adobe.com
Workers getting too comfortable may stagnate rather than take on additional responsibilities or learn new skills.
Advertisement
This impacts their marketability and career growth when the labor market eventually improves, Bohn cautioned. Employers might also decide these static workers no longer meet performance standards.
It's not inherently bad to stay in a job for a long time, experts stressed, but hugging too tightly can backfire.
The freeze-up also makes it harder for new entrants like recent graduates to break in. With fewer workers moving up or out, there's nowhere for them to slot in, Ullrich told CNBC.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Axios
22 minutes ago
- Axios
Plans call for new hotel on Hillsborough Street near N.C. State
The owners of a parking lot near N.C. State University on Hillsborough Street are in the early stages of submitting plans for a seven-story Graduate Hotel. Why it matters: The parking lot at 1912 Hillsborough St. — a site adjacent to the popular Players Retreat bar — has long been eyed for development. In 2018, the owners of the lot had plans to build a condo building with 35 units there, but the plans never moved forward. Driving the news: The property's owners, Raleigh-based real estate investors Mark Andrews and Michael Sandman, submitted plans on Aug. 14 to the city under a sketch plan review — an application that allows applicants to review site rules before a full plan submission. The plans call for a Graduate Hotel with 49 structured parking spaces. Graduate Hotels, a Hilton-owned brand that operates more than 30 hotels near college campuses around the country, has not responded to a request for comment. The Triangle Business Journal first reported on the submitted plans. What they're saying: But Sandman, who was an investor in the nearby Aloft Hotel on Hillsborough, told Axios the goal is to build a Graduate Hotel on the site, with a design inspired by N.C. State. Sandman and Andrews are partnering with Summit Hospitality and the Bernstein Cos. on the project, according to Sandman. "Mark and I purchased the property 10+ years ago and have considered other options through the years but have always come back to entertainment and hospitality," Sandman said in an email. "... We're very excited about the partnership and the project. It's an important location that deserves special attention and an A+ project."
Fast Company
22 minutes ago
- Fast Company
‘Job hugging' is the newest career trend: Here's what it means—and why Gen Z is into it
The era of ' job hopping ' is over—get ready for 'job hugging.' Korn Ferry, a global organizational consultancy firm, recently published a new report showing that employees are no longer moving quickly between new job opportunities, and are instead choosing to stick it out in their current positions for the foreseeable future. 'At an alarming rate, more and more employees are displaying what is colloquially known as 'job hugging'—which is to say, holding onto their jobs for dear life,' the report reads. Just a few years ago, job hopping—or moving from company to company in search of the next best opportunity— was trending among employees, especially younger workers looking to climb the corporate ladder. Now, though, the opposite is true. Korn Ferry's analysts say AI disruption, a lack of new jobs, and an unpredictable economic market are some of the main reasons why employees are doubling down on their current positions. What is job hugging? According to a July report from Eagle Hill Consulting, the majority of employees plan to stay in their current position for at least the next six months, with Gen Z employees reporting the most intent to remain in place. Further, the data found that the Market Opportunity Indicator—a measure of employees' perception of the outside job market—has dropped to its lowest level since the report's inception. The growing pessimism around employment opportunities isn't unfounded. A recent report from Challenger, Gray & Christmas found that through the end of July, U.S.-based employers had announced more than 800,000 job eliminations in 2025— the highest number of jobs lost in the same period since the global pandemic in 2020. Meanwhile, job growth has turned sluggish: Per a July report from Bureau of Labor Statistics (BLS), the U.S. economy created just 73,000 jobs in July, down from the 111,000 monthly average of earlier this year. The report also majorly edited down previous estimates for May and June job creation. Many employees are pumping the brakes on hiring as inflation rises and President Trump's tariffs continue to throw the market into periods of major flux. On top of these trends, the increasing utility of AI technology is changing how some organizations are structured, and even threatening some occupations with replacement. Korn Ferry cites all of these factors as contributing toward the growing prevalence of 'job hugging.' 'Market instability is one of the major reasons I see as to why candidates, especially to performers, are reluctant to move,' says Stacy DeCesaro, a managing consultant at Korn Ferry. 'Top performers are waiting for a more stable market before they take a risk with a new role and company. Top performers are generally only leaving if they are miserable in their current role, are offered a significant compensation increase, or are feeling very unsettled with their company's viability, leadership, or culture.' For recruiters, Korn Ferry's report notes, this trend is poised to make hiring significantly more difficult. On the bright side, though, it might be an opportunity for organizations to invest more in their top talent and encourage younger employees to put down roots.
NBC News
23 minutes ago
- NBC News
When 'invest like the 1%' fails: How Yieldstreet's real estate bets left customers with massive losses
When Justin Klish stumbled upon an ad for Yieldstreet in February 2022, he said, it was the company's tagline that stuck in his head. 'Invest like the 1%,' the startup said. The ad spoke to his desire to build wealth and diversify away from stocks, which were then in freefall, Klish said. Yieldstreet says it gives retail investors such as Klish access to the types of deals that were previously only the domain of Wall Street firms or the ultrarich. So Klish, a 46-year-old financial services worker living in Miami, logged on to Yieldstreet's platform, where a pair of offerings jumped out to him. He invested $400,000 in two real estate projects: A luxury apartment building in downtown Nashville overseen by former WeWork CEO Adam Neumann 's family office, and a three-building renovation in the Chelsea neighborhood of New York. Each project had targeted annual returns of around 20%. Three years later, Klish said he has little hope of ever seeing his money again. Yieldstreet declared the Nashville project a total loss in May, according to an investor letter, wiping out $300,000 of his funds. The Chelsea deal needs to raise fresh capital to avoid a similar fate, according to another letter. Both letters were reviewed by CNBC. 'There isn't a day that goes by without me saying, 'I can't believe what happened,'' Klish told CNBC. 'I lost $400,000 in Yieldstreet. I consider myself moderately financially savvy, and I got duped by this company. I just worry that it's going to keep happening to others.' Distributed risk Yieldstreet, founded in 2015, is one of the best-known examples of American startups with the stated mission of democratizing access to assets such as real estate, litigation proceeds and private credit. To do so, it gathers funds from thousands of investors such as Klish, who typically put in at least $10,000 each for projects vetted by Yieldstreet managers. The startup's central premise is that the world beyond public stocks and bonds — often called alternative assets or private market investments — provides both smoother sailing and the possibility of higher returns, a win-win proposition. This month, President Donald Trump signed an executive order designed to allow private market investments in U.S. retirement plans. But Yieldstreet customers who participated in its real estate deals in recent years say they've learned the flip side of the private markets: They face huge losses on investments that turned out far riskier than they thought, while their money has been locked up for years with little to show for it besides frustration. The company said in a statement that its real estate equity offerings from 2021 and 2022 were 'significantly impacted' by rising interest rates and market conditions that pressured valuations industrywide. This article is based on dozens of investor letters that were sent to customers by Yieldstreet and reviewed by CNBC. The documents show investors put more than $370 million into 30 real estate projects that have already recognized $78 million in defaults in the past year. Yieldstreet customers who spoke to CNBC say they anticipate deep or total losses on the remainder. The breadth of Yieldstreet's struggles in real estate — its biggest single investment category — hasn't previously been reported. CNBC's analysis covers a wide swath of deals that the company offered between 2021 and 2024, but doesn't include every project, of which there were at least 55, according to Yieldstreet. The troubled projects vary. They include apartment complexes in boomtowns such as Atlanta, Dallas and Nashville, Tennessee; developments in coastal cities including New York, Boston and Portland, Oregon; apartment buildings in the Midwest and single-family rental homes across Florida, Georgia and North Carolina. Of the 30 deals that CNBC reviewed information on, four have been declared total losses by Yieldstreet. Of the rest, 23 are deemed to be on 'watchlist' by the startup as it seeks to recoup value for investors, sometimes by raising more funds from members. Three deals are listed as 'active,' though they have stopped making scheduled payouts, according to the documents. Additionally, Yieldstreet shut down a real estate investment trust made up of six of the above projects last year as its value plunged by nearly half, locking up customer money for at least two years. Yieldstreet's overall returns in real estate have plunged in the past two years; the category went from a 9.4% annual return rate in 2023 to a 2% return rate in the company's most recent update on its website. But only customers participating in a specific fund get information about its performance, and Yieldstreet labels its investor updates 'confidential,' warning customers that the information in them can't be shared without consent from the startup. While not uncommon in the private markets, those limitations make it hard for investors to know if their experience is unique. Klish said he began to worry about his investments in early 2023 when updates became late and began to hint at deteriorating market conditions. Frustrated by those delays and what he described as a lack of candor from Yieldstreet about his sinking investments, Klish turned to forums on Facebook and Reddit for a sense of the bigger picture. There he said he found a few dozen other customers who shared their Yieldstreet experiences. 'When I dug into the other deals, I realized that this is systemic,' said Klish. 'Almost every single deal is in trouble.' In July, Klish filed a complaint, which CNBC has reviewed, with the U.S. Securities and Exchange Commission alleging that Yieldstreet misled its investors. Klish said he has yet to receive a response to his complaint. Missing ships, busted tie-up Yieldstreet calls itself the leading platform offering access to the private markets, a category that has boomed over the past decade as professional investors seek sources of yield beyond stocks and bonds. Founded 10 years ago by Michael Weisz and Milind Mehere, the company has well-known VC backers including Khosla Ventures, Thrive Capital and General Catalyst. Yieldstreet was part of a wave of fintech startups created in the aftermath of the 2008 financial crisis, including Robinhood and Chime, with a populist message. 'Our mission at Yieldstreet is, how do we help create financial independence for millions of people?' Weisz said during a 2020 CNBC interview. 'You do that by helping people generate consistent, passive income.' Weisz, who became CEO of Yieldstreet in 2023, brought experience in litigation finance, where hedge funds lend money to plaintiffs for a slice of the payout if the lawsuit wins. Mehere, a former software engineer who had co-founded online marketing startup Yodle, was the more technical of the pair. Yieldstreet declined to make the co-founders or other executives available for this article. In early 2020, Yieldstreet announced a partnership with BlackRock, the biggest asset manager in the world. The startup said at the time that its new Prism fund would contain a mix of its private market assets with conventional bond funds managed by BlackRock. Here is the 2020 interview with Yieldstreet co-founder Weisz: The move seemed to signal that Yieldstreet was primed for mainstream success. BlackRock had spent 18 months vetting the company before agreeing to the tie-up, Yieldstreet's co-founders told CNBC at the time. The month after its public announcement, though, Yieldstreet had tougher news to share. It was becoming clear that customers in another one of its product lines — loans backed by commercial ships that are torn apart for scrap metal — would suffer losses, the firm told them in March, according to a Wall Street Journal report. Yieldstreet lost track of 13 ships in international waters that backed $89 million in member loans, according to an April 2020 lawsuit filed by the startup against the borrower in that project, which it accused of fraud. In October 2020, a British court sided with Yieldstreet in the lawsuit against the borrower, a Dubai-based ship recycler. The episode scared off BlackRock, which ended the partnership weeks after it was announced, according to a person familiar with the matter who asked to remain unnamed so they could speak freely about private conversations. A Yieldstreet spokeswoman at the time told The Wall Street Journal that the BlackRock launch was initially successful but the fund 'was then faced with the market environment caused by Covid-19.' Three years later, the SEC fined Yieldstreet $1.9 million for selling a $14.5 million marine loan to investors even when it had reason to believe the borrower had stolen proceeds from related deals. Yieldstreet also didn't use 'publicly available' methods to track the ships it was relying on for collateral, the SEC said. 'YieldStreet aims to unlock the complex alternative investments market for retail investors but failed to disclose glaring red flags it had about the security of the collateral backing this offering,' an SEC official said in a 2023 release accompanying the settlement, for which the company neither denied nor admitted to the agency's findings. Still, the company continued to rack up assets on its platform, in part by ramping up activities in real estate. By 2023, real estate funds made up 26% of all investments on the platform, the largest asset category and well ahead of runners-up such as private credit, Yieldstreet said at the time. Late that year, Yieldstreet announced it had acquired Cadre, a startup co-founded by Jared Kushner that focused on broadening access to commercial real estate. The companies declined to disclose terms of the deal, but Yieldstreet said the combined entities' 'investment value' was nearly $10 billion. In May 2025, Yieldstreet replaced Weisz as CEO with Mitch Caplan, a former E-Trade chief who joined the startup's board in 2021. That's the year the venture firm where Caplan serves as president, Tarsadia Investments, took a stake in Yieldstreet. The company declined to say why Weisz was replaced. In July, Yieldstreet announced a $77 million capital raise, led by Tarsadia Investments. 'Difficult news' Yieldstreet continued to make moves in real estate well after a seismic shift that made the industry far harder to navigate had begun. In early 2022, the Federal Reserve kicked off its most aggressive rate-hiking cycle in decades to combat inflation, turning the economics of many projects from that period upside down. The value of multifamily buildings has dropped 19% since 2022, according to Green Street's commercial property index. Projects that Yieldstreet put its customers into struggled to hit revenue targets amid price competition or had problems filling vacancies or raising rents, and thus began to fall behind on loan payments, according to investor letters. Combined with the use of leverage, or borrowing money that amplifies both risks and returns, Yieldstreet investors suffered complete losses on projects in Nashville, Atlanta and New York's Upper West Side neighborhood, the letters show. 'After exhausting all options to preserve value, YieldStreet determined there was no reasonable path to recovery,' the firm told customers who invested $15 million in the Upper West Side deal. 'We sold our position for $1.' It's unclear if Yieldstreet, which makes money by charging annual management fees of around 2% on invested funds, itself suffered financial losses on the defaults. In at least a half dozen cases, Yieldstreet went to its user base again in 2023 and 2024 to raise rescue funds for troubled deals, telling members that the loans combined the protections of debt with the upside of equity. But if the project was doomed, a bailout loan was, at least in one case, effectively throwing good money after bad. A $3.1 million member loan to help rescue the Nashville project, located at 2010 West End Avenue, was wiped out in just months. 'We are reaching out to share difficult news,' Yieldstreet told investors of the Nashville project and its member loan in May. 'Following multiple restructuring attempts, the property has been sold to Tishman Speyer ... resulting in a complete loss of capital for investors.' In a statement provided in response to CNBC's reporting for this article, Yieldstreet said it has offered 149 real estate deals since inception and has delivered positive returns on 94% of matured investments in the category. That 94% figure likely doesn't include the distressed projects that CNBC has identified, since those funds aren't yet classified as matured while Yieldstreet seeks to salvage projects on its watchlist. The watchlist designation doesn't always result in the loss of investor funds, Yieldstreet said in another statement. 'Of the nearly $5 billion invested across the platform, a set of real estate equity offerings originated during 2021–2022 were significantly impacted by rising interest rates and broader market conditions that pressured multifamily valuations across the industry,' Yieldstreet said through a spokeswoman. Adverse selection On its website, the startup says it offers only about 10% of the opportunities it reviews, signaling its discernment when it comes to risk. But several professional investors pointed to the possibility that, instead of securing only top-quality deals in real estate, Yieldstreet may be getting ones that are picked over by more established players. 'There's no question you've seen deals that institutions have passed on that went to the platforms because retail investors might have less discipline than the institutional ones,' said Greg Friedman, CEO of Peachtree Group, an Atlanta-based commercial real estate investment firm. 'It's a reflection of a lack of discipline in underwriting and market conditions going against them,' Friedman said of Yieldstreet's track record. 'Anything done after 2022, they should have done more carefully knowing that we are in a higher-rate environment.' In late 2022, Yieldstreet even told investors that real estate was a 'safe(er) haven' asset during periods of rising rates and high inflation. By then, the Fed's intent to squash inflation with higher rates was well understood. 'Real estate can be an effective inflation hedge, carries low correlation to traditional markets, and has even benefitted in times of market downturns, generating outsized returns,' the startup said in a blog post at the time. In the post, Yieldstreet gave the example of the Alterra Apartments, a multifamily project in Tucson, Arizona, where it said rent increases and a contractual cap on interest rates protected it from the Fed hikes. But this year, Yieldstreet told investors in the $23 million deal that the Tucson development was in technical default and headed for a full write-off. 'Mind-boggling' Customers interviewed by CNBC accuse the company of downplaying investment risks and say that its disclosures around performance can be sloppy or misleading. Mark Underhill, a 57-year-old software engineer, said he invested $600,000 across 22 Yieldstreet funds and faces $200,000 in losses on projects that are on watchlist and have never made payouts. 'With any investment, there's a risk of loss,' Underhill said. 'But there's no consideration of these type of gut-punch losses. They talked about how their deals were backed by collateral, and they gave you all these reasons that make you feel there's something left if the deal goes south.' Underhill, who was treated with chemotherapy for multiple myeloma last year and travels the American West in a camper van, said his losses are forcing him to work beyond his expected retirement date. 'The thing that is mind-boggling is, how did they fail so badly on so many deals in so many markets?' Underhill said. The offering sheet for the Upper West Side project said sales prices would have to plunge 35% for Yieldstreet members to see any losses, a worse hit than what New York experienced during the 2008 recession, Klish wrote in his July complaint to the SEC. But the project defaulted even though prices in the area didn't fall by that much, Klish wrote. In another example, while participants in the Nashville deals got letters showing a complete loss, or a -100% return, Yieldstreet's public-facing website listed a 0% internal rate of return, or IRR, giving the false impression that investors got all their capital back. After CNBC asked Yieldstreet for comment on the discrepancy, the website was updated to reflect the -100% return. The company also stopped issuing quarterly portfolio snapshots after early 2023, making it harder for prospective investors to see how Yieldstreet's overall investments are performing. So besides marketing materials, customers are mostly left to rely on the company's disclosures about its performance as a gauge of whether to invest with the startup. Yieldstreet says it updates its metrics quarterly, and its website shows a 7.4% internal rate of return through March 2025 across all investments. That period likely excludes the impact of the Nashville defaults, which were disclosed in May 2025. 'Winter is coming' Yieldstreet's real estate woes threaten to wipe out decades of savings for Louis Litz, a 61-year-old electrical engineer from Ambler, Pennsylvania. Seeking income and stability, Litz put $480,000 into Yieldstreet funds, he said. Three of those projects have defaulted, while seven developments are on watchlist, he said. 'At least half of this stuff is going under,' Litz said. 'I'm 61, so there's no way I can really recover.' Under its new CEO, Caplan, Yieldstreet has decided to pivot away from a business model of mostly offering bespoke investments like the ones that cratered for its real estate customers. This month, Yieldstreet said that it officially became a broker-dealer, allowing it to offer funds from outside asset managers including Goldman Sachs and the Carlyle Group. The plan is to become a distribution platform where 70% of funds are from these established Wall Street giants, Caplan said this month. The move is worlds away from the confidence that Yieldstreet co-founder Weisz had in the company's original model. In the 2020 CNBC interview, Weisz said that he often reminded his staff that 'winter is coming' and to prepare for turbulence. Yieldstreet would protect its customers from losses because of the underlying collateral the firm was investing in: real buildings with tenants in sought-after locations all over the country, Weisz said. 'I'm not here to tell you that Milind and Michael are the world's smartest investors and there's never going to be something that goes wrong,' Weisz said, referencing himself and his co-founder. 'We understand that when winter comes, there will be challenges, but we take comfort in knowing that there's underlying collateral.' 'Anybody could put money out,' Weisz said. 'It's about bringing it back home.'
