How to deal with the Great Resignation
IN THE NOT-SO-DISTANT In the past, bosses didn’t have to worry so much about their workforce. Newcomers could absorb the corporate culture in an osmotic way. The families of the workers were invisible, not constantly interrupting Zoom calls. Employees had a job, not a voice. Now, companies need to “be intentional” (management’s way of thinking) about everything from the office to how staff communicate with each other. Retention is the last area that needs special attention.
The surge in staff departures known as the Great Resignation is centered in America: a record 3% of the workforce left there in September. But employees in other places are also cowardly. The quits explain why job-to-job movements in Britain hit a record high in the third quarter of this year.
Part of the unsubscription is transitory. It was difficult to act on pent-up job dissatisfaction when economies were plummeting, so there is a post-pandemic backlog of job changes to be cleared. And quitting smoking now is not the same as quitting a sustained job later. As Melissa Swift of Mercer, a consultancy firm, notes that white-collar workers looking for a higher goal will carefully choose a new employer and stay longer.
But there’s also reason to believe that higher churn rates are here to stay. The prevalence of remote work means that more roles are plausible options for more job seekers. And the pandemic has reduced the precariousness of life to the bottom of the income scale. Resignation rates are highest in industries, like the hospitality industry, which are teeming with low-wage workers who have many potentially risky face-to-face contacts with co-workers and customers.
A conventional solution – identifying a few star artists and making them lose extra money – is not a retention strategy if a large chunk of the workforce thinks differently about their work. What should managers do?
First, they should systematically assess the retention risk their business faces. It is too late to determine what made people quit smoking; Rather than exit interviews, forward-thinking companies conduct âmaintenance interviewsâ to find out what is holding employees back. Focusing on small teams during the pandemic is another tactic: burnout rates are likely to be higher in departments that have made redundancies. It is also essential to understand the vulnerability of a company vis-Ã -vis other employers. When giants like Amazon or Walmart raise wages or add benefits, the effects spill over beyond retail.
Second, managers need to operate different levers to retain different types of people. Wages are important for everyone, but for low-wage workers in particular, benefits such as health care have also become essential. A recent survey of young Americans by Jefferies, an investment bank, found that health problems were the number one reason people with only a high school diploma quit their jobs.
It’s a similar story for flexible working. For white collar workers, the separation between office and home is what matters. For blue collar workers, especially single parents, the schedule is important: the start and end of their shifts and the leeway they have to manage their time.
Companies also need to think more about the career paths that entry-level employees can take. In a recent survey of large companies conducted by the Institute for Corporate Productivity, a research organization, a majority admitted that they did not have adequate data on the skills of their workers, which made it more difficult to detect talents. A quarter felt that LinkedIn knew more about the capabilities of their workforce than their own companies.
Third, managers must plan how to find new workers. Remote work makes it easier to lose people but also to quickly integrate freelancers. Qualification requirements can be relaxed. In recent years IBM removed the undergraduate degree requirement from more than half of its US job postings. And there’s no better time for businesses to tackle stupid regulation. In response to a shortage of truck drivers, the UK government decided to combine separate tests for driving rigid and articulated trucks into one.
The Great Resignation should also prompt a question that is rarely asked: what is the right level of unsubscribe? It is more expensive to hire new employees than to keep current employees. Yet by this logic, companies would never want anyone to quit. The mix of old and new is what matters. The existing hands provide the cultural ballast; carpenters bring new skills and perspectives. Keeping good employees happy is vital. But people are like water: there is too much retention.
Read more from Bartleby, our management and labor columnist:
The Business Guide (November 20, 2021)
Business leaders are stranger than ever (November 13, 2021)
Why Executives Love the Office (November 6, 2021)
This article appeared in the Business section of the print edition under the headline “Handling the Great Resignation”