How HR can turn The Great Resignation into The Great Retention
Introduction
In usual circumstances, a significant number of people quitting their jobs is an indication of a robust economy with an abundance of employment opportunities. However, the current situation is far from normal. The COVID-19 pandemic caused the biggest recession in the history of the US economy. And yet, employers are facing a severe shortage of labor.
Amid easing pandemic restrictions, a record 3.6 million Americans quit their jobs in May 2021 alone, resulting in a staggering 10.9 million open positions by July end. The unprecedented wave of resignations and job hunting has been dubbed the "Great Resignation."
Trends of resignation
1. Mid-career employees report the highest resignation rates
The study found that employees between the ages of 30 and 45 have had the greatest increase in resignation rates, with an average increase of more than 20% between 2020 and 2021; While resignation rates fell for those in the 60-70 age group.
2. Resignations are highest in the tech and healthcare industries
Ian's study found that companies in different industries experienced varying turnover rates. The healthcare industry saw a 3.6% increase in resignations compared to the previous year, while tech industries saw a 4.5% increase. The study concludes that higher resignation rates were observed among employees who worked in fields that experienced a surge in demand due to the pandemic, resulting in increased workload and burnout.
What is causing the Great Resignation?
The Great Resignation is not just a battle for remote work. Although burnout is increasing and is likely to continue rising, it is not the only reason employees are quitting their jobs. The increasing workload is just one of the causes of burnout. Additionally, employees also lack the emotional support they need to thrive during these challenging times.
The Great Resignation is not just about pay, vacation days, or time-offs. It's a workplace issue where employees are questioning the meaning of the daily grind.
HR Strategies for Great Resignation: Transforming into the Great Retention
1. Turn to data
When employees leave an organization, it can create a gap in skillsets or resources, which has a negative impact on the quality of work, time to completion, and ultimately the bottom-line revenue. In order to address this issue, it is important to first quantify the scope of the problem and its impact. One way to do this is to calculate the business retention rate and determine the impact of resignations on key business metrics. By understanding the underlying causes of turnover, the organization can take proactive steps to prevent future resignations and improve overall retention rates.
Analyze data to identify the root cause of staff turnover. Explore metrics such as compensation, promotions, performance, and training opportunities. Create customized retention programs to address specific issues within the organization.
2. Find out what employees want
A survey conducted by the Limeade Institute, which covered 4,500 employees in five countries, found that 56% of employees were not consulted by their employers about their opinion on returning to the office before being called back in. This lack of consideration is a prime example of how not to build trust in the workplace. Furthermore, if HR is unaware of what their employees want, they cannot develop retention strategies based on their needs.
3. Support long-term retention strategies
HR practices must become people-centric. Create an employee experience where employees feel connected to the purpose of the organization, are energized by the work that they do, and where the workplace feels positive.
4. Offer the flexibility of hybrid working
Organizations must offer benefits that promote long-term well-being for employee retention and increased productivity and happiness.
Causes
Over 40% of the global workforce plans to quit their jobs in 2021, according to Microsoft's Work Trend Index. The COVID-19 pandemic has caused workers to rethink their careers and goals. Most workers prefer remote work due to its flexibility, which is the primary reason why people are looking for new jobs. Younger workers are also seeking a better work-life balance. Labor market segmentation can explain the varying resignation rates across different industries (Lambert, 2022).
Figure 1: Trends for monthly resignation rates from 2019 to 2022
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Except 2020, we can see that resignation rates are roughly aligned pre- and post-pandemic start which tells us that resignation is not a temporary issue, but an ongoing one.
Conclusion
There is an ongoing debate about whether the Great Resignation will have a long-term impact. Although quit rates have been high, a significant number of workers in Western countries have returned to the labor force in late 2021 and early 2022. Generally, an aging population coupled with a labor shortage is accelerating industrial automation, not only to compensate for the "missing" workers but also to reduce costs.
Reference
- Sharon Monteiro (2023) https://www.peoplehum.com/blog/hr-great-resignation-into-great-retention.
- https://en.wikipedia.org/wiki/Great_Resignation Accessed on 20.11.2023
- Images Available at https://www.google.com/search?q=images+great+resignation&rlz=1C1LOQA_enLK1076LK1077&oq=images+for+greater+resignation&gs_lcrp=EgZjaHJvbWUqCAgBEAAYFhgeMgYIABBFGDkyCAgBEAAYFhgeMgoIAhAAGIYDGIoFMgoIAxAAGIYDGIoFMgoIBBAAGIYDGIoF0gEJMTI2MzBqMGo0qAIAsAIA&sourceid=chrome&ie=UTF-8
- https://www.visier.com/blog/new-data-great-resignation-continues-2 S022/ Accessed on 20/11/23
- Video Available at https://youtu.be/TWcwL6NjFTU
ReplyDeleteThe "Great Resignation" has been a defining trend, a challenging reality for employers during these uncertain times. However, this shift also presents an opportunity for HR to leverage strategies and transform it into "Great Retention." This insightful post addresses critical aspects causing this trend and provides actionable strategies to tackle it effectively.
Great breakdown! Understanding why people are leaving their jobs is eye-opening. The strategies for keeping employees and the stats showing this trend continuing after COVID-19 are super interesting. Thanks for the insights!
ReplyDeleteYour post on the "Great Resignation," stresses its effects on numerous businesses and the rising tendency of mid-career resignations. and also precisely explain the numerous reasons behind this phenomenon, emphasizing not only distant work but also meaningful work and work-life balance. To combat this tendency, effective HR techniques like data analysis, employee engagement, and hybrid work models are crucial to retention.
ReplyDeleteYour blog on how HR can turn The Great Resignation into The Great Retention is a strategic playbook for navigating current workforce challenges. The insights on proactive measures and employee-centric approaches are commendable. Consider augmenting it with real-world examples or case studies, offering tangible strategies for HR professionals seeking to foster employee retention amid changing dynamics. A valuable resource!
ReplyDeleteBy implementing a combination of these strategies and customizing them to suit the organization's culture and needs, HR can work toward turning the tide from high turnover rates to improved employee retention and satisfaction.
ReplyDeleteHR can help turn the tide from high turnover rates to increased employee retention and satisfaction by employing a combination of these methods and tailoring them to the organization's culture and needs.
ReplyDeleteYou have covered issues like as fatigue, limited growth, inadequate compensation, bad leadership, and job insecurity.
ReplyDeleteVery much detailed and very well explained.
HR can transform the "Great Resignation" into the "Great Retention" by proactively addressing employee concerns, enhancing communication, offering professional development opportunities, and creating a supportive work environment. Understanding and addressing the root causes of dissatisfaction can foster loyalty and contribute to long-term retention.
ReplyDeleteYour blog on the Great Resignation is a must-read! Your human resource management insights shed light on the complexities of this phenomenon, offering valuable perspectives for navigating these unprecedented times. Excellent Work!
ReplyDelete