How to manage a major resignation
Idon’t separate In the past, bosses didn’t have to worry too much about their workforce. Newcomers can osmotically absorb the company’s culture. The workers’ families were invisible, and Zoom calls were not constantly interrupted. The staff had a job, not a voice. Now companies have to be “intentional” (management talks about thinking) about everything from the office to how employees communicate with each other. Retention is the latest area to require attention.
The surge in employee departures known as the “Great Resignation” is centered on America: 3% of the workforce left their jobs in September. But staff elsewhere are also at large. The resignations explain why job-to-job transition in Britain reached a record high in the third quarter of this year.
Some churning is temporary. It was hard to work on pent-up job dissatisfaction while economies were in a free meltdown, so there has been a post-pandemic backlog in job switching to explain it. More quitting now is not the same as constant job hopping later. As Melissa Swift of the consultancy Mercer notes, white-collar workers looking for a higher purpose will choose a new employer carefully and stay longer.
But there is also reason to believe that high rates of instability are here to stay. The prevalence of remote work means that more roles are reasonable options for more job seekers. The pandemic has brought back the fragility of life at the bottom of the income ladder. Resignation rates are highest in industries, such as hospitality, which are filled with low-paid workers who have a lot of direct contact with potentially risky colleagues and clients.
One traditional solution — identifying a few superstars and forcing them to get extra cash — is not a retention strategy if large groups of the workforce think differently about their jobs. What should managers do?
First, they must systematically measure the retention risk their company faces. It is too late to know the reasons why people quit smoking; Instead of exit interviews, forward-thinking companies conduct “survival interviews” to see what keeps employees. Focusing on teams that are being curtailed during the pandemic is another tactic: Burnout rates are likely to be higher in departments that have been laid off. Understanding the company’s vulnerability to other employers is also key. When giants like Amazon or Walmart raise wages or add perks, the effects extend beyond retail.
Second, managers need to use different tools to retain different types of people. Salaries matter to everyone but for low-wage workers in particular, benefits such as health care have also become central. A recent survey by Jefferies, an investment bank, found that health concerns were the main reason people with only a secondary education left their jobs.
It’s a similar story to flexiwork. For white collar folks, it’s the separation between the office and the home that is important. For blue-collar workers, especially single parents, scheduling is important — when their shifts begin and end, and how much space they have to manage their time.
Companies also need to think more seriously about the career paths that entry-level employees can take. In a recent survey of large companies conducted by the Corporate Productivity Institute, a think tank, the majority admitted that they do not have enough data about the skills of their workers, which makes it difficult to spot talent. A quarter thought LinkedIn knew more about the capabilities of their workforce than their company.
Third, managers must plan how to find new workers. Remote work makes it easy to lose people but also to get freelancers to work quickly. Qualification requirements can be relaxed. In the last years IBM It eliminated the requirement to have college degrees from more than half of American job opportunities. There is no better time for companies to target deceptive regulation. In response to the shortage of truck drivers, the British government decided to combine separate tests of driving rigid and articulated trucks into one.
The Great Resignation should also lead to a question that is rarely asked – what exactly is the right level of disruption? Hiring new employees is more expensive than retaining existing employees. However, by this logic, companies would never want anyone to resign. What matters is the combination of old and new. Existing hands provide cultural heft; Carpenters bring new skills and perspectives. Keeping good employees happy is vital. But people like water: there is such a thing as excessive retention.
This article appeared in the business section of the print edition under the heading “Managing the Great Resignation”