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Fewer workers quit their jobs in 2023, a sign of reduced confidence in the labor market, according to The Wall Street Journal (subscription).

What’s going on: “Americans quit 6.1 million fewer jobs last year than in 2022—a decline of 12%, the Labor Department said Tuesday. In December alone, quits fell to the lowest monthly level in nearly three years, after adjusting for seasonal fluctuations.”

• Quits decreased in manufacturing last month also, to 203,000 in December from 215,000 in November, according to the Bureau of Labor Statistics.
• That’s the slowest pace in more than three years—and it suggests “that churn has returned to a pre-pandemic pace in the sector,” said NAM Chief Economist Chad Moutray.
• The economy-wide quits decline is an about-face from the trend seen just after the pandemic, when job quitting skyrocketed and employers faced worker shortages, the Journal reports.

But manufacturing is still hiring: While in the larger economy the “hiring rate slowed to 3.6% in December from 4% a year earlier,” in manufacturing there was positive net hiring in December, with 9,000 net new hires across the industry, according to BLS data.

Why it’s important: “The declining quits rate will limit how fast wages grow, as companies are less pressured to attract and keep workers,” according to the Journal.

• “That could be good for the Federal Reserve, which has been working to tame inflation, but not appreciated by workers seeking raises.”