Since the Covid-19 pandemic started more employees than ever have left their jobs to re-evaluate their work-life balance due to high levels of burnout and switching to positions that offer more flexibility, with a high increase in demand of remote jobs.
If you are a business owner, there is no better time than the present to re-evaluate what your employees mean to you and what losing them in mass amounts would do to your company. Even if you haven’t yet felt the effects of the Great Resignation, and you may never have to worry about it, it’s still an imperative move to really consider how you might retain your team if you face losing them.
For many companies, both small and large, the Great Resignation is proving to have substantial consequences. Supply chains are short, customer service is near non-existent, and global chains like Starbucks are closing early due to a lack of employees.
While this tells us quite a bit about the current state of the workforce in general, it’s impossible to assume that companies aren’t unintentionally (or intentionally) repelling their employees. In this guide, we’ll talk about the Great Resignation, the current state of the workforce, and what you can do to avoid feeling the effects as the pandemic makes its way toward a close.
- What is the Great Resignation
- The Cause Behind the Great Resignation
- Statistics from the Great Resignation
- What to Expect from the Great Resignation
- Advice for Companies to Face the Great Resignation
What is the Great Resignation?
A phenomenon brought on by the Covid-19 Pandemic, the Great Resignation describes people leaving their jobs of every level in record numbers. While we’ve already seen the beginnings of what appears to be inevitable mass resignation, experts predict that this is nothing compared to what might happen as the pandemic ends.
There’s a record of open job positions and a boom in remote based jobs being hired with a +71% YoY growth seen in 2021 vs. 2020 in the Remoters Job board, that had already seen an important growth in the demand of remote jobs. Resignation rates appear to be the highest among employees at a mid-career status, but that doesn’t mean businesses should not expect their experienced and entry-level employees to follow suit.
Though technology and healthcare industries see the highest rates of resignations, no enterprise is immune. Employers interested in avoiding the impending Great Resignation should take a data-driven approach, reviewing current statistics within your own companies as well as those within your industry. If you can understand why people are leaving, you can take the necessary steps to prevent it from happening.
The Cause Behind the Great Resignation
There’s been a ton of buzz behind the Great Resignation, causing stress for employers, especially those that own small businesses. Let’s take a ride back to the beginning of the pandemic, where employers laid people off in masses.
Business Models Relying on In-Person Work
Not only did millions of people around the world lose their jobs, but those that kept their roles battled financial and physical survival. While some companies went remote, those who worked at in-person essential services risked infection every day, and for many, it was hard to justify a paycheck that came with a risk of serious illness, and decided to quit and look for other jobs types that allow them to work from a remote setting.
Plenty of business models fell apart during the height of the pandemic, including food service, hospitality, and retail. Currently, in the United States, service-related jobs have a low-retention rate and demand. Remote work is clearly favorable, so the issue now is for the service industry, healthcare included, to figure out how to retain employees when remote work is impossible.
Now the world is taking a slow turn toward recovery, and those that are no longer living paycheck to paycheck are leaving their jobs in record numbers. Some cannot afford this and stay, but this doesn’t mean that the frustrations aren’t running rampant throughout the workforce due to the intense disruptions created by the pandemic.
A Shift in Workplace Expectations & Remote Work Boom
On the other hand, many of those employees that started to work from home during the Pandemic went through major stress to balance the challenges of first time remote work experience while taking care of family in exceptional circumstances. This made many to re-evaluate their careers and workplace expectations, and also gave the opportunity to identify and assess alternatives of a new mode of more flexible working.
While we don’t know what the workplace will look like when the pandemic ends ultimately, we can be sure that it will not look the same as ten or even five years ago. Companies globally have announced that they will not expect employees to return to an office setting full time, many of the best known organizations in the world have completely shifted to a remote based or hybrid work environment, and most employers will likely now provide more flexibility, with essential employees coming in to the office only when needed.
With many more companies now also hiring for remote based roles, employees have also had the alternative to shift in record time to find that new “dream job” opportunity.
Eye-Opening Statistics from the Great Resignation
A record of 4.4 million Americans left their jobs in September in 2021 and in the UK voluntary departures between April and December in 2021 were higher than in the same period in 2019. Resignations continue to remain high, though employers across the nation promise higher working wages and plenty of benefits. Whatever employers are promising, it hasn’t been enough.
Women Driving Resignation Rates
Female resignation rates were sky-high when the pandemic’s peak hit, closing schools and daycares all over. Let’s face it; many parents, especially mothers felt forced to leave their jobs simply because there wasn’t another option. Even those that had the opportunity to work from home could not take it due to remote learning responsibilities and the fact that nursery schools and daycares weren’t risking a possible rampant infection of Covid-19.
Also, you can consider the fact that many service industries employ an overwhelming amount of women. Not only were women resigning due to family obligations, but many couldn’t bear the severe effect the pandemic had on such industries. So, while the great resignation is undoubtedly happening in real-time, it’s crucial to consider such components, as they can help current employers figure out how to avoid losing more employees in the near future.
No matter how you look at it, women are leading job resignations and more than willing to change jobs. In August of 2021, women came in at one percent higher than men concerning job resignations. This statistic is a defined red flag for the economy and likely means that women will not return to the workforce at the same rate as men, though that data remains uncovered for now.
Revealing Statistics Regarding the Current State of the Workforce
The trend of women resigning faster than men applies to small and large businesses. However, the rate at which women currently leave the workplace is not the only shocking statistic to come out of the Great Resignation. 2021 left us with the following labor statistics:
- 94% of retailers in the United States have significant trouble filling vacant in-store positions, and shockingly, it doesn’t seem to have to do with money. Even with the implementation of sign-on bonuses and referral programs, potential employees aren’t showing interest.
- 55% of workers in America plan to look for a new job within the next 12 months. That number is more than half of the workforce in the U.S. If you take a moment to review the research, you’ll see that this statistic is prevalent among low-income workers, minorities, and young people.
- 34% of the workforce is engaged, meaning that many workers come to work and do the absolute bare minimum. Not surprisingly, disengaged employees quit more often, as they are unhappy and, as a result, stressed.
- The desire to continue working remotely is great, and 1 in 3 Americans would not consider working for an employer that does not offer at least partially remote work. This statistic alone should encourage businesses to retain knowledge workers by allowing them to work remotely or risk losing them to a company that does.
- 66% of employers say that they’ll plan on redesigning the workforce to host a hybrid model as the pandemic attempts to draw to a close. There is an undeniable desire for work flexibility, and it’s not something that workers are willing to give up.
- Not surprisingly, remote work is a top priority for millennials and Gen-Z workers. In fact, according to this survey, millennial and Gen-Z workers were willing to give up 10% of their total pay for the option to work remotely.
The Meaning Behind Current Workforce Trend Statistics
There is no question that the pandemic changed the way employees view their work, and many employees have realized that their life shouldn’t revolve around work. The tables are starting to turn, and people emphasize personal time, equating it to pay. If employers refuse to keep up with the times, they’re going to take a hit in the form of staffing.
What to Expect from the Great Resignation
Offering Flexibility, Growth Opportunities and Value Beyond Money
Flexible hours and virtual based work are sure to remain at the forefront of employee requirements as we move into, through, and past the Great Resignation. The goal of all employers should be to maintain a fair, equal, dignified, and healthy work environment for all employees that cross the physical or virtual workplace threshold.
Companies of all sizes will have to learn how to manage the expectations of remote work, including the effectiveness of coordination and communications across employee networks and examining security and data privacy options. The point here is to begin the processes now if you haven’t yet, so you are well-prepared to deal with the fact that remote work isn’t going anywhere, and to retain your workforce, you’ve got to be prepared to offer that flexibility.
The Great Resignation will show most workers working on a remote or hybrid environment. The service industry will have to evolve as well, but it will look a little different than the adoption of a flexible remote model.
The Evolvement of the Service Industry
For the industries hit the hardest by the Great Resignation, it’s crucial to embrace some level of change. Money is no longer the only aspect that drives employee engagement. We briefly touched on employees equating their personal time to pay, so ensuring employee fulfillment is an excellent place for the service industry to start.
Assign Genuine Value
These days, people are accepting jobs based on so much more than pay. Many are looking for a way to turn their passion into a paycheck, so it’s the employer’s job to make them feel valued and utilized based on their talents.
We all want to feel seen and like we’re making a difference. This concept isn’t based on neediness, as it’s often mislabeled; instead, it’s all about value.
Growth Opportunities
While it may sound harsh, if there’s no room to grow, there’s no point in staying. New opportunities and engagement are the keys to keeping employees engaged and interested in succeeding at their jobs. Promotions should come with a new title and job responsibilities, and often, the latter part of the equation is left out.
Empowering Responsible Employees
Micromanagement is a killer of the appeal of the service industry. While most industries are letting go of security concerns and finding new ways to keep data safe while employees transition to a work-from-home model, the service industry typically doesn’t have this luxury.
For the most part, service still means face-to-face, but that doesn’t mean employers can’t create an environment built on collaboration and efficiency. It’s time to make life easier for employees, and that’s the bottom line.
Facilitate Human Connection
Though remote work is exceptionally desirable, there is a lack of human connection. Employers in the industries battered by the Great Resignation have this on their side, as humans naturally crave a sense of belonging. Socializing is good for us, and when working from home, we often don’t get as much as we’d like.
The issue lies in the modern workplace’s focus more on service and less on employee happiness. There has never been a time in the history of the American workforce where employee happiness was more important. Encourage collaborations and interactions between employees.
Efficient Onboarding Processes
A transparent and efficient onboarding process allows employers to understand which employees are a good fit. Just because there’s a shortage of people willing to work and an overabundance of jobs doesn’t mean you should fill vacant positions to fill them.
You have a better chance of avoiding high turnover rates when you have an onboarding process that outlines employee benefits, expectations, and values. Job candidates aren’t vying for positions anymore, and it’s time for you to show them why they should want to work for you. This table-turning approach is one of the most significant changes to come out of the Great Resignation.
Advice for Facing the Great Resignation
For so many businesses, the Great Resignation is already here. The service industries suffer the most, but that doesn’t mean that other companies won’t feel it when the pandemic inevitably tapers off. While losing employees is inevitable at times, you can help your company avoid yielding them exponentially, which causes early closures and temporary shutdowns.
Provide Work Flexibility
Ideally you should be able to provide your employees the ability to work from anywhere, with flexibility on hours, assessing their performance based on the outcome and value of their work rather than hours they work. For this you can take a look at this guide about how to establish successful remote work policies, in case you haven’t yet. If that’s not entirely possible due to your company business model, it’s then recommended to shift the way you operate to provide as much flexibility as possible, such as in working hours for a better personal/work time balance, balance in type of tasks, etc.
Offer Wellness Benefits
Start offering mental health support, fitness programs, education stipend and childcare, among other benefits, beyond the fundamental health insurance. This focus on employee well-being is vital, especially during stressful times like that ones we’re going through, so emphasize those offerings along with healthcare.
Be an Empathic Leader
Leading your employees on a holistic level means viewing each team member as a person with a life outside of the job they do for you every day. Communicate to them that you fully understand the stress that the pandemic has put on families, and strongly consider offering employer-covered care for mental, physical, career, emotional, and social health. There are options for both large and small companies to make this priority.
Transparent Communication
Employees despise dishonest employers, and in today’s workforce, there is absolutely no room for employers to harbor a lack of transparency. This concept is archaic at this point. Understanding employee well-being means knowing what they need from you, giving them the chance to communicate that need, and then heeding to those expectations. Follow up with every concern to increase employee value.
Stay Positive and Proactive
Gone are the days when the boss is a damaging hammer in the office space, cracking down on time-wasting and encouraging a toxic, work your fingers to the bone to put food on the table environment. It’s time to approach employee well-being with a positive and proactive attitude, understanding that employee expectations are continually evolving, and updating benefit packages to encourage retention efforts.
Your employees cannot engage with you if you don’t engage with them. Step up, lead by example, and go to work every single day with the mindset that your employees will give you 100%, as long as you provide it to them first.
For some companies, the Great Resignation may be impossible to avoid. However, listening to your employees and taking action based on their needs will help you stay competitive in a challenging labor market. Gaining a competitive edge now is essential to help your company avoid the fallout of the Great Resignation.
If you liked this post, take a look at:
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- Remote First Vs. Hybrid Mode: Pros & Cons To Consider When Deciding Which To Choose
- How to Hire and Pay International Remote Employees
- 14 Direct and Indirect Remote Work Benefits for Professionals and Companies
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