Over 20 million Americans quit their jobs in the latter half of 2021, as part of the so-called Great Resignation, and it’s affecting companies both financially and culturally. However, companies are responding accordingly to a new workforce paradigm by employing more effective strategies and tactics to win over new and existing employees.
What is the Great Resignation?
The Great Resignation denotes the record high numbers of people quitting their jobs since the start of the pandemic. Workers between the ages of 30-45 saw the highest increase in resignations. Industries seeing higher than normal quit rates since the previous year include the healthcare and tech industries, with a 3.6% and 4.5% increase, respectively.
Some of these voluntary resignations are early retirement. The number of those opting for retirement has doubled since the pandemic.
Others decide to leave their jobs to care for their children, especially amidst the uncertainty surrounding school closures, due to COVID-19.
For others still, the Great Reshuffle is a more fitting name. They aren’t leaving the workforce entirely; rather, they’re empowered to pursue other jobs that offer more flexibility, higher pay, and other perks. Others switch jobs due to push factors, such as toxic work culture and burnout.
How the Great Resignation Affects Your Business
Whether employees are quitting in droves in your company or in your industry, the Great Resignation affects the efficiency of HR’s efforts and processes as well as the broader company culture.
HR’s ROI
It’s no surprise that each job vacancy costs your company money as you try to refill it. That’s why the financial impact of the Great Resignation is felt most acutely in HR. When an employee quits, it can cost anywhere from half to double of that employee’s salary to replace them. The cost varies according to position level as well. To fill a vacated entry-level position, it costs the company about half of that entry-level salary. In contrast, hiring someone new who already possesses the necessary skills will cost more than someone who onboards at entry-level and learns on the job.
Cultural effects
A toxic work culture and low employee morale causes employees to exit. However, when employees perceive a mass exodus in their company, it can trigger or worsen a negative cultural response among those who stay, creating a vicious catch 22.
Read more: Improving Work Company Culture During Periods of High Turnover
What Your Company Can Do to Attract and Retain Talent
Data Collection
It’s imperative to collect data when employees leave your organization. Exit interview management software, such as ExitPro and intelliHR, assists not only with offboarding but with gaining valuable insights as to why an employee is leaving. This data empowers your company to implement new processes, initiatives, and software tools. Having a simplified process in place also increases the chances of an amicable departure that won’t negatively impact your company’s reputation.
Read more: Why HR is Integral to Achieving 5-Star Reputation Management
It’s also important to keep communication channels open and garner regular feedback through occasional surveys in order to gauge employee satisfaction in the workplace. Team Collaboration Software, such as Slack, Monday.com, or Gusto, enable easy communication between employees and HR. Quantum Workplace offers an array of employee engagement surveys that can be deployed at different times and for varying purposes. The feedback generated from new hires helps your company improve its onboarding and recruiting processes.
Read more: The Best Tools for Effective Employee Recruitment
Branding
Building a positive brand image for your company attracts customers but potential employees as well. Engaging in reputation management can bolster your passive recruiting strategy. Brand monitoring tools, from SEMrush for example, help you maintain a positive online presence.
Ownership
Empower your employees to take ownership of their work to boost their satisfaction. Quantum Workplace’s one-on-one meeting software facilitates regular conversations about an employee’s goals and performance supplemented with data, making it easier for employees to ask for, justify and, in turn, receive the raises they deserve.
Read more: Need to Increase Employee Retention? Train Managers as Career Coaches
Recognition & Rewards
Feeling undervalued is the driving factor behind at least 79% of exits, according to OC Tanner Research data from pre-pandemic times. This number is likely to be higher now, given the balance of power shifting toward employees.
Read more: Gen Z Values and How Companies Can Prepare for the Workplace of the Future
Software solutions, such as 15Five or Assembly, let employees give and receive recognition for outstanding work. Your company can also distribute digital rewards to keep employees motivated and valued.
Work-life balance
Thirteen percent of workers quit because their jobs didn’t provide work-life balance. 40% of survey respondents who had switched jobs in 2021 cited burnout as their number one reason for quitting. Your company should invest in tools and programs that support their overall well-being, such as meditation app subscriptions and gym membership reimbursements.
Flexibility
A desire for more work-life balance almost always coincides with increased flexibility about when and where employees work. 71% of employees report that the ability to work remotely positively impacts their decision to stay. A survey conducted by Slack found that 72% of respondents prefer a hybrid work set-up. Some form of remote work is here to stay. Upwork’s 2021 Future Workforce report projects that 40.7 million Americans will be working remotely in the next five years.
Finding ways to support employees in their desired work format and schedule will be key. This involves investing in virtual collaboration tools and supplying employees with the equipment they need to work from home.
Policy
The popularity of remote and hybrid work arrangements has likely prompted a reevaluation of your company’s pre-pandemic policies surrounding vacation, sick days, parental leave, childcare, work location, tax withholdings, and more.
As your company adapts to new workplace trends, review and update your policies to reasonably accommodate the employee needs that emerge in your communication and surveying practices. Keep your policies updated and in one place with knowledge management tools.
Read more: 6 Ways to Reduce Employee Attrition That Have Nothing to Do With Beer
How Your Company Can Successfully Navigate the Great Resignation
Companies that blame the Great Resignation on the pandemic, global leadership, and other external factors at the expense of adapting their company to new workforce trends will be the great losers in the Great Resignation.
The Great Resignation poses a tremendous opportunity for companies to re-examine their work culture, policies, benefits, and more, in order to attract and retain highly skilled employees. Taking a data-driven approach with people analytics tools, such as ZeroedIn, increases your company’s chances of being a great winner in the Great Resignation.
Read next: A Key to Employee Retention: Know What Your Individual Contributors Care About
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