In 2019, Texas A&M professor Anthony Klotz dubbed the phrase “The Great Resignation” to describe a voluntary, mass exodus from the workforce.
According to recent data, it looks like that’s exactly what we’re living through right now:
- 11.5 million workers quit their jobs between April and June 2021 (U.S. Department of Labor)
- For every 100 job openings, there are 83 available workers (Bureau of Labor Statistics)
- Anywhere between 40-50% of workers are considering leaving their jobs right now (Microsoft & Gallup)
So is this the Great Resignation we’ve been waiting to see? Why is it happening now? What’s the relationship to COVID-19? And, most importantly, how should employers respond?
Let’s dive into the numbers and find out.
What are employers saying?
If you ask most employers, they’ll certainly say the job market has certainly transformed as a result of the COVID-19 pandemic.
According to survey data from job board Indeed, 73% of employers are struggling to hire and retain workers. Conversely, only 5% are experiencing the opposite effect.
Across the board, here is how employers feel about the job market currently:
- 86% believe employers need to take immediate action to reduce churn
- 86% say they should increase concerns about resignations
- 85% agree the pandemic has changed beliefs around what a “good job” is
- 76% say resignations are contagious among the workforce
- 51% believe how they handled the pandemic resulted in subsequent resignations
Among these statistics, one theme stands out: workers are leaving their jobs at higher numbers than we’ve seen in recent years. And employers feel an urgent need to respond.
Why are workers leaving?
According to that same survey from Indeed, the following are the top reasons why employees are resigning:
- Higher pay (59%)
- Schedule flexibility (58%)
- Work-life balance (56%)
- Remote work options (54%)
- Focus on personal and family responsibilities (50%)
As a result, many employers are stepping up their benefits. Perks like increased flexibility, higher pay or signing bonuses, and remote work options are now commonplace.
What we’re actually seeing is the development of a new and interesting phenomenon: employees aren’t just making decisions with their heads, but also with their hearts.
According to survey data from LinkedIn, 74% of respondents indicated that these changes are a direct result of COVID-19.
The unfortunate reality of the pandemic has had a two-fold effect:
- After working from home for a year, employees realize that more flexibility and balance is possible in their lives
- Employees value balance, especially time with friends and family, in light of a particularly difficult time filled with serious illness and loss
As a result, employees are more demanding now than before. This has changed the market dynamics and put the ball in employers’ court: if you want to attract great talent, you have to step up your game.
There’s one more thing we need to point out: this isn’t just a Millennial or Gen-Z thing.
In fact, new research from analytics firm Visier indicates that the cohort of employees aged 30-45 years saw large increases in resignations from August 2019 to August 2020. Plus, as of December 2020, resignations among managers were 12% higher than the previous year.
This signals that more established career professionals are more likely to consider switching jobs.
Isn’t this just typical summer churn?
Given the fact that we just got out of the summer, can’t we chalk this up to the fact that this is just typical summer churn?
If that’s the case, we would expect to see these numbers start to go down right about now.
But actually, the opposite is happening.
Recent data from Pave seems to suggest otherwise. Even taking into account the fact that companies experience higher churn during the summer, 2021 is still seeing a massive uptick in resignations.
How should employers respond?
A ping-pong table isn’t a retention strategy.
When many employers think about how to retain customers, they often go for the “hip and cool” benefits, like fancy snacks or gym memberships or weekly happy hours.
The problem here? These things aren’t actually effective at retaining customers.
In fact, in a recent article from Fast Company, Elizabeth Segran argues that The Era of Wacky Office Perks is Dead:
For years, companies have spent money on fun workplace perks in order to attract young talent…But a new study finds that these snazzy office benefits aren’t what young workers really want. Instead, workers younger than 35 place more value on respect. The research suggests that companies should invest more in training managers to communicate respectfully and nurture employee well-being, rather than kitting out offices with trendy new accessories.
Remember what we said earlier: it’s established professionals that are leading the charge on the Great Resignation.
These people (for the most part) don’t care about all the fancy perks that they’re probably not going to use anyway.
Instead, they care about how they’re treated at work. Are they treated with dignity and respect? Do you respect their family responsibilities? Do they have flexibility in their schedules? Do you recognize them for their accomplishments?
A study of more than 400,000 people published in Harvard Business Review found that when employees believe promotions are managed effectively, employee turnover rates are half that of other companies in the same industry.
And according to bonusly.com, 63% of those in a recent survey who said they are regularly recognized also said they are very unlikely to look for a new job.
So if you want to get serious about retention, here are some specific, actionable steps you can take:
- Spend some time listening to your employees and gather input
- Strive for maximum flexibility in your work arrangements, without sacrificing quality, productivity, and service
- Prioritize workplace safety, instituting and enforcing COVID protocols to mitigate people’s concerns
- Show empathy to your customer-facing teams, who are likely dealing with ugly complaints about delays, errors, or other issues
- Focus on retaining each individual on your team by prioritizing their growth and well-being; each person you lose is a blow to your organization’s effectiveness and morale
- Recognize that resignations are contagious, and work to allay any concerns your fellow team members may have
- Keep a pipeline of potential hires; in this market, it’s never a bad idea to have a few people in your back pocket just in case you lose a team member
Granted, you probably won’t be able to keep everyone. There are some people who are going to leave your company, despite your best efforts.
But if you focus on building a great culture, respecting your team, and engaging in meaningful work, even those people who leave will be a great referral channel for new talent.
Are you struggling to build a pipeline of potential hires? If so, Brightwing can help you identify & qualify top talent. Fill out the form below.
SEND US A MESSAGE