You might have heard a lot of people talking about The Great Resignation or the Big Quit everywhere. But actually, what is it?
According to the Bureau of Labor Statistics, through November 2021, an average of more than 3.9 million workers quit their jobs each month, holding the highest average record to date.
The Great Resignation is an economic trend in which employees are voluntarily resigning from their jobs en masse, beginning in early 2021. It started first in America when the government refused to provide necessary worker protections in response to the COVID-19 pandemic, resulting in wage stagnation amid the rising cost of living.
Now before we talk more about it, what do you think might’ve caused it? The COVID-19 Pandemic is definitely to blame. But it isn’t this easy as it sounds.
The COVID-19 pandemic has allowed workers to rethink their careers, work conditions, and long-term goals. As many workplaces attempted to bring their employees in person, workers desired the freedom to work from home given the pandemic. With telecommuting also came schedule flexibility, which was the primary reason to look for a new job. And with everything being hybrid, this flame just plummeted. As soon as the companies asked the employees to work from the office, they quit their job and went to find a new one. This has impacted the companies the most. Restaurants and hotels, industries that require in-person interactions, have been hit the hardest by waves of resignations. COVID-19 stimulus payments and rises in unemployment benefits allow those who rely on low-wage jobs for survival to stay home.
According to a study conducted by Adobe, the exodus is being driven by Millennials and Generation Z, who are more likely to be dissatisfied with their work. More than half of Gen Z reported planning to seek a new job within the next year. Additionally, millions of people are also suffering disabilities from long COVID, altering their ability or desire to work.
And before you wonder who was the first one to start this, while unconfirmed, Daft Punk’s unexpected resignation on February 22, 2021, may have inspired many to follow suit.
Employer demand remains high, resulting in more job openings, higher wages and more turnover. There were 10.6 million job openings posted just on the last day of November 2021, more than in any month before the pandemic began and far more than the roughly 7 million unemployed people looking for work. Competition for workers has led to faster wage growth, particularly for those changing jobs. And employees/ candidates are making the most of it. Offer Shifting, a term that you might’ve heard recently, is what is happening. I’ll explain this with an example-
Due to the work-from-home setup, candidates can now apply to any part of the country, while staying at home. So, the candidate applies to company A, while already working in B. So, he quotes his current CTC to A and asks for a raise. Now with this new CTC, he then calls his company asking for a raise, even before it’s due or else he quits the job.
You see what happened here. Candidates are asking for an unnecessary hike in their pay, or else they quit. This is one of the core reasons for the Great Resignation that people are overseeing.
Now that we know what caused it, you would want to know how we can prevent it. Certainly, I cannot suggest guaranteed ways to completely stop it, but here’s how you can reduce it:
Address Employee Concerns
Communicate with the employees and see what challenges they are facing. Try to find solutions for their problems. Convince the employees that you actually care about them. The pandemic has been hard for them, and when one finds the company acknowledging their work and looking out for them, they will certainly want to stay in such an environment. The best way to reduce turnover is to understand why employees stay and why they leave.
Present Realistic Job Descriptions
Turnover tends to be highest among new hires—often because the job does not match their initial expectations. Once they experience what they perceive to be the downsides of a job, they quit. The solution is, to be honest, and realistic about the JDs. Tell them everything they should know about their job- from the perks to the worst part of it.
Establish strong onboarding and mentoring
Once the candidate joins, provide them with a plan. They should have a goal as soon as they join the company. This will not only keep them motivated to move ahead but also make them feel that they’re contributing towards something.
New hires have weak ties to the organization, so it is easier for them to leave. To retain them, help them make connections as quickly as possible.
Offer New Opportunities
According to an MIT Sloan Study, one of the best ways to retain talent is to provide lateral job moves. The study found out that people experience burnout due to a lack of new challenges and a monotonous schedule. When employees are offered new jobs at their companies, they are almost 12% less likely to resign.
Have a Strong Work Culture
The study also found that companies that have a healthy work culture are less likely to lose employees. Creating a better workplace includes hosting more cooperative social events, providing employees with benefits like happy hours and organizing more excursions outside the office.
Lastly, companies should offer employees more remote working opportunities. Agree or not, hybrid working is the future. While not all industries would benefit from work from home policies, high wage earners, who tend to have more comfortable housing arrangements, tend to prefer working from home.
What are your thoughts about Great Resignation? Do you agree with the points we’ve mentioned in the article? Do let us know your thoughts in the comments section.