Six Factors Behind the Great Resignation
Employees reevaluating their careers and quitting their jobs in astronomical levels amidst the pandemic is a 2021 occurrence most popularly known as “the Great Resignation,” or what you may sometimes come across as “the Big Quit.” The Great Resignation is a concept proposed by an associate professor of Texas A & M University in the name of Anthony Klotz who predicted such mass worker exodus in May 2021.
However, it is important to acknowledge that the pandemic is not the sole reason for the Great Resignation. The US government has only kept an eye on resignations since 2000 and data show that in 2019, even before COVID-19, quitting was already prevalent. Therefore, although resignations skyrocketed in 2020, it is highly likely that employee turnover could have surged even without the pandemic as the trigger.
If it’s not the pandemic alone, then what else are really driving “the Great Resignation?”
Here are 5 other identified causes of increasing voluntary employee turnover rates:
1. Lack of DEI (Diversity, Equity and Inclusion) initiatives
DEI is vital to creating and maintaining a successful workplace. The long-term effects of racial and social injustice have compelled many to leave their workforce in search of other companies that offer more flexibility, a sense of belonging, and an environment where everyone can participate and thrive.
Employees who have been continuously subject to microagressions – either historic or current – at work express that they feel safer working from home.
While a large number of companies or employers counteract this issue with various DEI campaigns to support their workforce, some of these actions still fail to fortify employee retention strategy.
It is recommended that companies reassess their efforts, policies and motivations around DEI, implement a more data-driven approach to identify what each employee needs to remain in the company; and lastly, demonstrate real commitment to social justice in the workforce. Definitely avoid applying one-size-fits-all solution.
2. Employees are undervalued
Cases such as well-paid but dissatisfied, unappreciated employees are not very uncommon. Especially during the stressful times of the pandemic, many employees have put extra effort and energy into their work without due recognition or reward from their respective employers, causing the former to feel burnt out and like wanting to leave.
Statistics shows that 69% of employees are expected to stay if their contributions, achievements and performances are recognized. This is, in fact, one HR strategy that guarantees loyalty and increase in employee retention.
It is also worth mentioning that successful employee retention enables companies to secure a solid talent pipeline and save millions of dollars in training/hiring costs.
3. The pursuit of work-life balance
Remote work has made “business hours” meaningless. Employees now work round-the-clock. There is no “on/off” button for when work starts and when it ends. A study revealed that people check their emails or Instant Messaging tools every 6 minutes. In this digital age, clearly, this has become a hard habit to break, especially for people wanting to be responsive 24/7. Majority of those working from home feel like they are expected to be available for communication at all times. This has resulted in employees feeling burnt out, being “work martyrs” and being unproductive.
But leaders often miss this emotional exhaustion of employees, causing employees to ultimately reconsider the type of job they want or seek a company culture that supports work-life balance and can define exactly what “business hours” means to the company. Although employees have the power to choose how often they should work, leaders also have a critical responsibility to strongly encourage employees to reset and recharge and lead by example.
Different companies, different teams, different working hours. It’s not important which hours are working hours. Truly, what matters is understanding that not all hours are working hours.
4. Employees need career advancement
A research by Robert Half suggests that 38% of professionals expressed feeling stuck in their careers since the pandemic due to salary growth stagnation, limited professional network growth and insufficient skills development opportunities. That number jumps to 66% for employees between 18 and 24.
The same research shows that employees’ career and employers’ promotion plans have been negatively impacted by the pandemic. Hence, many are starting to worry about their career growth, thereby considering voluntary upskilling in preparation for career transition post-pandemic.
Companies that invest in their people by providing training opportunities can transform employees and promote employee retention.
5. Better compensation and better benefit plans
Great compensation and benefit packages help attract, motivate and retain talent, even more so when the pandemic started. Higher pay, flexibility and better wellness programs are key elements that employees look for in their company. In fact, according to a Prudential survey,
“42% of current remote workers say if their current company does not continue to offer remote work options long term, they will look for a job at a company that does.”
To attract the right candidates and retain current talent, reexamine the company’s EVP (Employee Value Proposition) and see to it that it is up-to-date and still relevant.
There are many factors that contribute to the Great Resignation, but if there are two things this Great Resignation has shown: first, that employees are beginning to demand more from companies in terms of compensation, benefits and culture to suit their lifestyle; and that many are reflecting on whether the jobs they have still motivate them, considering the current diverse workforce situations. Second, that companies are working hard to stay competitive on the market by implementing more flexible solutions, designing better benefits packages, providing necessary worker protection, and even refining company cultures to accommodate every individual’s demands and ensure employee retention.
The Great Resignation which many deem a “2021 phenomenon” is very much a real thing and has the tendency to persist into the future with people’s new way of life. Normally, employee turnover was only very widespread among younger age groups as they are most of the time excited to advance their careers or raise their incomes. However, surprisingly, in 2021, it was learned that employees aged between 30 and 50 within more stable brackets are seen to be resigning too, which is why this Great Resignation has been quite disruptive. Many employers are under the impression that the Great Resignation was in Q4 of 2021 due to the majority of people resigning. But brace yourselves for this is only the tip of the iceberg! With a large number of employees waiting for their year-end bonuses, the backlash of the Great Resignation is expected in Q1 and Q2 of 2022.
But having learned that the Great Resignation has been subtly hanging around since pre-pandemic, it’s not yet too late for leaders to start doing what they can now to reduce the impact or the possibility of talent drain in their companies moving forward.