Since the outbreak of the pandemic, employees have been leaving the workforce or switching jobs in droves. For many, employers are playing a big part in the reason for them walking.
A Microsoft survey containing more than 30 000 workers globally showed that 41% of workers were considering to quit or change professions this year, and a study from HR software company, Personio, of workers in the UK and Ireland showed 38% of those surveyed planned to quit in the next six months to a year. In the US alone, April saw more than four million people quitting their jobs, according to a summary from the Department of Labour – the biggest spike on record.
There is a number of reasons why people are seeking a change, in what some economists have dubbed the ‘Great Resignation’. For some workers, the pandemic precipitated a shift in priorities, encouraging them to pursue a dream job, or transition to being a stay-at-home parent. But for many, many others, the decision to leave came as a result of the way their employer treated them during the pandemic. Ultimately, workers stayed at companies that offered support, and left those that didn’t.
Workers who, pre-pandemic, may already been teetering on the edge of quitting companies with existing poor company culture saw themselves pushed to a breaking point. That’s because, as evidenced by a recent Stanford study, many of these companies with a bad work environment made decisions that didn’t support workers, such as layoffs, while conversely, companies that had a good company culture tended to treat employees well. This drove out already disgruntled workers who survived the layoffs but who could clearly see that they were working in unsupportive environments.
And although workers have always cared about the environments in which they work, the pandemic added an entirely new dimension: an increased willingness to act, says Alison Omens, Chief Strategy Officer of JUST Capital, the research firm that collected a lot of the data for the study.
“Our data over the years has always shown that the thing people care about most is how companies treat their employees,” says Omens. “That’s measured by multiple metrics,” she adds, “including wages, benefits and security, opportunities for advancement, safety and commitment to equity.”
Aaron McEwan, from global research and advisory firm, Gartner, says that pandemics reshape society at fundamental levels, and this one is shifting the balance of power from employers to employees. “It has rewritten the psychological contract between employers and employees.”
Historically, a great worker experience was based on a good salary, a nice office, and how many benefits the employer could offer.
“Today, employees don’t want to be seen as workers. They want to be seen as complex human beings with rich, full lives,” Mr McEwan said. “They’re not just interested in the experience they can have at work, they’re interested in what an employer does to enrich their life experience.”
Many employees have been told that they would not be able to continue to work remotely – despite having done so since the outbreak of the pandemic and some many years before that. With management not being open to negotiation, workers easily quit and set out to find a more accommodating employer, or they even become self-employed.
Research has shown that people also tend to quit their jobs after experiencing a “turnover shock”: a life event that precipitates self-reflection about one’s job satisfaction.
The ‘Great Resignation’ is therefore being fuelled by fundamental shifts in how people think about the role that work plays in their lives. The pandemic has made many people reconsider that psychological contract entirely.
Many people are choosing to move away from ambition, and to emphasise other aspects of life. They are embracing “career downsizing” — looking for a job involving fewer hours or something with less responsibility and less stress. They are rethinking work that requires long-distance travel, always being on-the-job, endless meetings, stress and burnout. Instead, they are making career choices around their personal values, health and family.
Part of the problem, says Omens, is that while financial incentives are a start, a major shift in priorities means it is not just about the money. Many workers are departing in favour of entry-level positions elsewhere that in fact pay less, but offer more benefits, upward mobility and compassion. With employers across the board looking for new hires, many have found that it is easy to find another job and make the transition.
“We asked people if they would take a pay cut to work for a company that aligns with their values,” she adds, “and across the board, people answered yes.”
For both people inside companies as well as those just entering the job market, how a company treated its people over the past year and a half will inevitably determine the course of the future.
Could this ‘Great Resignation’ therefore bring about meaningful, long-term change to workplace culture and the way companies invest in their employees?
Omens believes that the answer is yes. The change was happening before the pandemic, she says, with a “real increase in what people were looking for in terms of their expectations of CEOs and companies”. Employers looking to stop the exodus should pay attention as much of the onus rest on them to give workers more reasons to stay.
In the wake of the pandemic the intensity has increased in terms of that expectation; people are expecting more from companies. The universal nature of the pandemic is a major reason for so many quitting at once. “Most people don’t evaluate their job satisfaction every one of 365 days in a year,” said Brooks Holtom, a Professor of management and Senior Associate Dean at Georgetown University. “Those shocks usually happen idiosyncratically for people. But with the pandemic, it’s happened en masse.”
According to Ross Seychell, Chief People Officer at Personio, “the pandemic put an acute focus on how companies treated employees who were given a lot to handle, ruing this time regarding their health or happiness. Seychell says many workers considering this question is finding a lack of satisfying answers. “I’m hearing it a lot: ‘I’m going to go somewhere I’m valued’.”
Workers have been expecting their employers to make moves to help alleviate, or at least acknowledge, their concerns – and companies that failed to do so have suffered. The Personio study also showed that more than half of the respondents who were planning to quit wanted to do so because of a reduction in benefits, a worsening work-life balance or a toxic workplace culture.
According to McEwan, “Companies will have to start […] selling the work to employees.” His advice to employers is to see this as a once-in-a-generation opportunity to “reconfigure work so that it’s actually designed for this new world we are finding ourselves in”. He said companies need to focus on the needs of their employees and find a way to drive their growth ambitions without overstretching already fatigued staff.
Seychell says it became compulsory for companies to make serious investments in their employees’ wages, opportunities, and overall wellbeing, if they weren’t doing so already, if for no other reason than it’s simply good for business. Employers should be thinking about how they can allow employees to have more satisfactory lives outside of work. If allowing people to relocate isn’t possible, maybe it means letting them stagger their work hours. To improve employees’ experience in their communities outside of work, companies can offer services and benefits that help people care for their families, like babysitting, elderly care, and good healthcare or encourage workers to volunteer and engage with local organisations and businesses, and they can support employees in building their own professional networks.
It can’t be assumed that everyone will return to work, at least as we once knew it, once the pandemic ends. Unlike previous generations whose jobs were tied to farms and manufacturing plants, the service-oriented jobs that dominate the economy allow people much more flexibility when it comes to where, when, and how they work. This means people—especially younger generations—are in a position to question what a job is, its purpose, and the terms of employment, says Holtom.
Coupled with the fact that turnover is consistently highest among young people and those in the first three years of a job, it is perhaps no surprise that millennials and Gen Z, who are calling for more work-life balance and more flexibility, are driving the ‘Great Resignation’. These workers are, as Los Angeles Times columnist, LZ Granderson, wrote recently, “resetting their priorities, and maybe forcing policymakers to do so, too.”
Here comes the great resignation. Why millions of employees could quit their jobs post-pandemic.
Lisa Leong et al. 28 Sept. 2021.
The Great Resignation: How employers drove workers to quit.
Kate Morgan. 1 July 2021.
The real reason everyone is quitting their jobs right now.
Yasmin Tayag. 7 Sept. 2021.