Get Ready for the Great Resignation
Over the last few months as restrictions have started lifting, there has been an increase in chatter about a wave of resignations and market churn (or the so-called ‘Great Resignation’). Expected in the latter half of 2021, we are asking, “Is this simply ‘noise’ or is there something deeper occurring?”
The view of the post pandemic world varies depending on who you ask. However, what seems to be coming into focus is that the pandemic has given many people the chance to evaluate their lives and priorities. As things begin to stabilise, there is an increasing likelihood of individuals deciding to ‘seize the day’ and make lifestyle changes, be that moving job, industry, or in some cases, opting for early retirement. Whatever the driver, the ‘great resignation’ is looking increasingly likely.
Various surveys on employee happiness and wellbeing put the percentage of employees now classified as a flight risk at between 26% – 40%. For example, the Microsoft Work Trend Index shows 40% of those surveyed want to switch jobs. This is largely driven by the realisation that they can work remotely.
Within technology, research by HR software firm Personio found that 38% of employees in the UK and Ireland were planning to change roles in the next 6-12 months or once the economy had stabilized. This rose to 55% amongst 18–34-year-olds.
For many Leaders, the statistics are worrying, as the job market is increasingly showing growing activity across multiple industries and sectors in both senior and junior positions. Twelve months ago, the amount of ‘open to work’ green LinkedIn banners was staggering; I now expect the tables to turn to ‘I’m hiring’ instead.
While sectors and age groups were affected differently by the pandemic and lockdowns, resignations are expected to become apparent across the board, amongst all cohorts. The final breakdown which is significant is across varying levels of seniority. Initial statistics show that ‘mid-career’ employees are most likely to embrace change in the coming upheaval. This echoes what we are hearing from our networks, which suggests that mid-career and middle-manager levels will be most affected. We will likely then see a secondary wave, a trickledown effect impacting the lower levels of employee.
What is driving this change?
As an organisation which specialises in Leadership Advisory, Norman Broadbent are seeing multiple factors coming into play. However, there is little doubt – and indeed, our Clients are telling us – that working from home is one of the major driving factors behind the current shift in priorities.
As organisations pivot to their post-pandemic strategy, days spent ‘in the office’ is inevitably having a significant impact on people’s perception of whether their current employer is still best for their work-life balance. Hybrid models will range and vary, from organisations implementing quite a rigid structure, to those which may remove fixed working hours entirely, enabling employees to decide when and where they work. SME businesses seem more willing to entertain a flexible hybrid structure, while larger companies are more likely to implement a more rigid structure, based around a 2/3 day split office/home. There are, of course outliers on both sides with some even moving to a complete remote working model.
It seems widely accepted that companies who drive five days a week working from the office will see the greatest level of attrition by far. Employees have become use to the freedom and autonomy of remote working and will vote with their feet if there is too much insistence on this model.
As the pandemic ground on, it was apparent that burnout was becoming a major issue across the board. Individuals were taking on increased responsibility due to staff being on furlough and increasingly high-pressure market conditions. Burnout, coupled with changes in their individual financial situations, will drive employees to find different environments which offer better prospects for wellbeing, work life balance, and financial stability. Increased retirements are also expected now the difficult economic situation has been navigated, driving vacancies up and enabling further movement. Furthermore, geography will impact the situation. Evidence shows both younger and older employees moved out of metropolitan environments during the pandemic. Aligned to the relocation aspect, daily commuting is no longer seen as a necessary evil to enable individuals to be ‘productive’, and in some cases may be a significant blocker to those employees returning to the office on a daily basis.
It is important to understand that this ‘Great Resignation’ will coincide with a significant skills shortage that has been brewing over a number of years. Competition for top and high-performing talent will be extremely high, and some organisations will lose out. It is more important than ever for organisations to combat the drivers for attrition. Protecting your workforce now will prove far less costly in the long run. Employers must eliminate as much uncertainty as possible to give staff stability, conduct surveys to understand how the company morale is, and make adaptations off the back of the results. Communication is key, and every moment of uncertainty, every rumour that does the round of the water cooler about ‘future plans’, could negatively affect staff retention.
Flexibility is crucial over the next 18 months. Trusting employees, and providing autonomy, are the best tactics for retainment of talent. As the recovery progresses, organisations will need to be adaptive and experiment with new ways of working whilst keeping productivity at the core of the strategy.
Norman Broadbent have been providing insight into workplace strategy to our clients throughout the pandemic, offering competitor and market-based intelligence through our in-house Research & Insight practice. To discuss the topic of staff retention and the ‘Great resignation’ in more detail, feel free to contact email@example.com for an initial confidential discussion.