Employers hope to welcome workers back to the office in the coming weeks following sixteen months of uncertainty. The COVID-19 pandemic was a rollercoaster ride for everyone. So, the prospect of "getting back to normal" is exciting for most.
But then it hit – The Great Resignation. While you knew there would be some employee attrition once business operations resumed, you probably weren’t prepared for the tsunami of resignations you've been receiving recently. Employers across the board are now facing a mass exodus of talent as workers reassess where they are professionally and weigh their options.
A Mass Exodus
In April, four million employees resigned from their jobs. By the end of that month, the U.S. saw the highest number of job openings ever recorded at 9.3 million. Some turnover is normal and even expected. Healthy companies see an average 20% annual turnover rate as employees seek better opportunities and seasoned workers retire. But current rates are unprecedented and have left employers understaffed and unprepared.
The Work Institute suggests in its 2021 Retention Report there are three primary reasons people leave their jobs where employers have significant opportunities to intervene:
Career Development – Lack of growth and development opportunities, no advancement or pathways to promotion
Work/Life Balance – Less of a commute, more flexible schedule
Manager Behavior – Poor communication, lack of support, and manager incompetence
It's safe to assume these elements still play a role in today's post-pandemic labor market, along with several other factors to consider, like remote work.
The "New Normal"
Due to the pandemic, thousands of employees shifted to working remotely. While hesitant at first, many people found they valued the flexibility that came from working from home, allowing them to save time and money on things like daily commutes and dry cleaning, and offering more time to focus on their health and family. A recent study finds an average worker would accept a 7% pay cut to continue to have the ability to work remotely. That aligns with other recent studies showing similar outcomes.
Major companies like Facebook have recently announced detailed work from home plans that factor in a pay rate for remote work and the ability to live in areas with a lower cost of living. Cultivating a company culture grounded in flexibility is vital to surviving the “new normal” expectations of today's workforce.
To achieve higher employee satisfaction and retention, many companies will need to consider remote or hybrid work scenarios or risk being overlooked by potential talent.
Offering a more flexible work environment also positions companies to give their employees a shot at achieving work-life balance. When employers provide space for employees to be more present with their families and pursue personal interests, they are more in tune with their physical and mental health. This sends a signal to prospective and existing employees that the company values people over profits.
Though wages rank as the fifth reason a worker leaves their job, companies may be forced to raise wages to attract talent. Increasing pay shows potential employees that you’re serious about filling positions. Efforts like signing bonuses are becoming more common in hopes of swinging the pendulum in a company's favor.
How to Deal
This new normal can be hard to navigate, especially for small to medium-size businesses already functioning with a bare-bones staff. With over 20 years of experience in the workplace dynamics driving The Great Resignation, we offer the following advice and expertise for companies experiencing high turnover:
Ask – When an employee leaves, conduct an exit interview, preferably managed by an independent third party, so the employee feels comfortable being honest with their responses. Danny Nelms, CEO of Work Institute explains, “After years of conducting exit interviews as third-party surveys, very rarely do the real reasons employees leave match what the executives, HR and hiring managers believe.” Otherwise, you’re likely to hear what you want to hear instead of the truth, which isn’t helpful.
Listen – Though it can be hard to hear, truly listen to why employees say they are leaving, plan for changes, and act. Be transparent about your shortcomings and dedicated efforts to change. Bring in outside experts, if needed.
Create a dialogue. Instead of traditional annual reviews, plan quarterly check-ins and semi-annual reviews to discuss performance and advancement opportunities. Also, provide continuous feedback, letting workers know immediately when they’re doing a good job or need to course correct.
Checking in more frequently ensures workers have the necessary support and direction to do their jobs. Providing psychological safety enables them to be honest in their feedback without fear of retaliation. In the moment feedback is proven to improve team performance, engagement, and retention.
Top-Down Commitment – Changes within an organization must start at the top and work their way down. Communicate with your employees about the changes you will be making, even if you haven't fixed all the issues yet. Your team will appreciate knowing you are listening and taking action. Don't forget to get middle management on board. As advocates and influencers, they are essential to getting buy-in from team members further down the ranks.
Plan – Include employees in future planning to create a sense of belonging and more certainty in their career trajectory. Communicate the company’s growth plan. Doing so builds enthusiasm and gives employees opportunities to provide feedback while building pride in their employer.
Finally, consider providing additional perks, like profit-sharing, which gives workers a sense of ownership and increases employee retention.
Surviving The Great Resignation
Today's job market is very different than it was just five years ago. If companies are not willing to accommodate the demands of top talent, they may find themselves in a precarious situation. Fact – employees have a newly discovered superpower, and they’re wielding it. But it doesn't have to be a power grab.
Your company can survive The Great Resignation if you lead with your head and heart. Now is the time to start building a company culture that supports the whole employee – professionally and personally. This ensures your business not only survives but thrives into 2022 and beyond.
