What is "The Great Resignation" and What Does it Mean For the Future of Organizations?
There’s no doubt that the pandemic has changed the way we live and work - especially our attitudes about work. Many are realizing that their once enjoyable job has lost its luster and their long hours and work stresses just aren’t worth it anymore. Over these past 2 years of the pandemic, millions of people have walked away from their jobs for a variety of reasons – they want to start their own businesses, they’ve found being at home with their families is more important – the list goes on. If you are feeling this way, you are most definitely not alone.
What is “The Great Resignation”?
The Great Resignation, also known as The Big Quit, refers to the record numbers of Americans who have left their jobs during the pandemic. The term was coined in 2020 by Organization Psychologist and Texas A&M Professor Anthony Klotz.
"During the pandemic, because there was a lot of death and illness and lockdowns, we really had the time and the motivation to sit back and say, do I like the trajectory of my life? Am I pursuing a life that brings me well-being?" Klotz said.
According to the U.S. Bureau of Labor Statistics, 6.3 million workers had left their jobs as of November 2021, and job openings clocked in at 10.6 million. We are seeing a majority of these numbers coming from the healthcare, retail, and hospitality industries. According to the World Economic Forum, industries with low location and time independence were the ones that suffered most during the pandemic work crisis. These are business models that are characterized by close proximity of location and time, which suggests that providers and receivers of a product or service are at the same place at the same time. These are businesses like dine-in restaurants, ship cruises, sporting events, music concerts, passenger airlines, etc.
Resignation rates are also high among mid-career individuals. Employees between 30 and 45 years old have had the greatest increase in resignation rates, with an average increase of more than 20% between 2020 and 2021.
Because of the record numbers of people leaving their jobs, companies are now forced to navigate this ripple effect and re-evaluate how to retain employees.
Tips to Retaining Employees During This Resignation
As we start out 2022, now is a great time for organizations to talk about and strengthen their employee retention strategies so they don’t fall victim to this resignation.
Identify the Problem – and Try to Quantify it First
Harvard Business Review suggests before identifying the inherent causes of turnover, a good first step is to identify your retention rate.
Number of Separations per Year ÷ Average Total Number of Employees = Turnover Rate
You can use this formula as well to identify how much of your turnover is coming from voluntary resignations, layoffs, or firings. This will help you get an idea about where exactly your retention problem is coming from. Now you are ready to determine the impact of resignations on key business metrics. As employees leave an organization, teams sometimes find themselves without key skillsets or resources, which negatively impacts the quality of work, time-to-completion, and eventually revenue. It’s important to track how turnover relates to changes in other relevant business metrics in order to get a broad view of the costs of resignations.
Identify the Root Causes
Once you’ve identified the scope of your retention problem, now it’s time to conduct a detailed data analysis to determine what’s really causing your staff to leave. Harvard Business Review says that exploring metrics such as compensation, the time between promotions, size of pay increases, performance, and training opportunities can help to identify trends within your organization. You can also categorize employees by location, function, and other demographics to better understand how their work experiences and retention rates differ amongst them. This analysis can help you identify not only which employees have the highest risk of resigning, but also which of these employees can likely be retained with targeted conversations.
Conduct Quarterly Check-Ins
It’s no secret that many organizations’ cultures have oscillated since the start of the pandemic. One way to get a glimpse into how your employees are feeling about the workplace, culture, environment, etc. is to conduct quarterly check-ins. Not only does this give leadership an idea of where employees are at professionally and mentally, but it also shows employees that their thoughts, feelings, and reflections during this time are being seen and heard by their higher-ups. This honesty and transparency will create a more compatible workforce.
Keep an Open Line of Communication with Your Employees
Going along with conducting quarterly check-ins, it’s also important to communicate regularly with your employees. Allow your employees to reach out to leadership through email, instant messaging, or in-person. Adopting an open-door policy is something many employers do, as it sets a standard in the office that communication is valued.
Elevate Your Organization’s Purpose
The purpose behind your organization is the reason it exists. At the end of the day, It’s the reason why people join and choose to stay. The Harvard Business Review’s analysis shows that in turbulent times, believing in what an organization is trying to achieve is more important now than ever. Organizations must prove to employees that there’s more than just the bottom line. And don’t just talk purpose; use it to shape what you do and how you do it.
Prioritize Culture and Connection
Sometimes it is crucial to put the work aside and make time to connect and build relationships with your people. This will help solidify their relationship with your organization, and research shows that social connection also has a significant positive impact on productivity.