What is the ‘Great Resignation’?
Almost ¼ of UK workers are planning to change jobs within the next 3-6 months according to The Guardian; 13% more than in other years! Ranstad UK surveyed 6000 workers, 69% of who responded that they were confident they would change role in the coming months.
I ran a short LinkedIn survey on this myself to see what was in the mind of my own network and found almost half of people who voted had either already or were actively planning to change jobs!
So what’s the problem?
Well, for anyone who’s followed me on LinkedIn for a while, you’ll know since long before the pandemic I’ve been banging on that the world of work is broken and organisations that ignore the imbalance of the system will face painful consequences. While this does apply more to toxic corporates that have hauled in vast riches and not shared fairly, I also believe smaller businesses (like those larger ones) can be more efficient, effective and by extension profitable by keeping their best staff and engaging them.
Those consequences have actually already been felt, but somehow, whether through ambivalence or apathy, many companies have managed to develop a resilience to the toxic concoction of poor staff attrition, attendance and performance; focusing in the main on inauthentic employer branding initiatives that attract great talent but can’t engage or keep it.
The reality is, for far too many people, the world of work doesn’t offer enough back in return for the investment of time, effort and sacrifice to take jobs, stay in them and engage. As our species matures, learns from the experiences of past generations and recognises the imbalances in our way of life, we become more conscious to inequalities and want more back for what we put in.
We already know the much maligned ‘Millennials’ want more intrinsic and extrinsic value from their career and are prepared to move between jobs until they get it. Anyone who thought that was going to disappear with the generation thereafter was certainly optimistic.
So, the ‘Great Resignation’ didn’t just appear from nowhere, we’ve been heading this direction for a while. Things need to change, dramatically. We need a fairer more balanced world of work. The pandemic, however, has escalated the situation for a number of reasons which included but is not limited to:
- People stayed in jobs they may otherwise have left because of the gamble on job security
- Reduced team bond and connection between employee, employer and colleagues while working from home resulting in fewer emotional reasons to stay (people work with people they like – during this period many haven’t been working with anybody)
- Post-pandemic burnout in employees who feel like they have been stretched to breaking point during this period and now want a change
- People seeing other employers embrace new ways of working and wanting the increased trust and flexibility they may not have where they are
- More job vacancies and opportunities as organisations innovate, bounce back and new ones appear
- People reflecting on their lives during this unique period and wondering whether they’re making best use of their time on this planet
- People looking at the charlatans who run our country and deciding to opt out of the rat race which is birthing billionaires at a record-breaking rate while the rest of us struggle to pay our bills…
To be fair, that last point this is not about any one political party and could probably be applied to most countries – it’s not like the world’s economic imbalance just started. But the pandemic has definitely made it even more obvious.
“Using data compiled by Forbes, Oxfam says in a new report that the total wealth of billionaires jumped from $8.6 trillion in March 2020 to $13.8 trillion in November 2021, a bigger increase than in the previous 14 years combined. The world’s richest 10 men saw their collective wealth more than double, shooting up by $1.3 billion a day.” (Source: CNN)
According to Forbes, the Economic Policy Institute reported preliminary data showing CEO’s average compensation jumped 16% during the pandemic. Meanwhile, Statista report that “Annual earnings for full-time employees in the United Kingdom fell by approximately 0.6 percent in 2021.” In ’22, the grinders and grafters who are critical to our companies’ success will puzzle over whether meagre increases actually still leave them worse off with the surging cost of living.
I wrote last year that organisations who looked after their employees and made them a priority in a desperate time would benefit afterwards with increased levels of loyalty and commitment from staff who appreciated their employer’s care. I would expect these organisations will not suffer the ‘Great Resignation’ as painfully as others.
What impact will it have?
Reports suggest that replacing an employee costs between 33 – 213% of their annual salary depending on the level and complexity of their role. To put that into perspective, using the UK average salary of £31,285 (source: Office for National Statistics), we can expect financial pain of at least £10,324.05 per leaver.
Most people don’t think about this, but when you add up the time and resource required to run a recruitment campaign, marketing costs, potentially agency fees, onboarding, training and development, then waiting for someone to stop making mistakes (costing the business money), become proficient in their new role and eventually reach the level of their predecessor – I would say 33% is a massive underestimation. Then of course, it depends on the level of role we’re backfilling and how valued the person we’re losing was. By the time the new person has become proficient, they’re probably already thinking about leaving too…
It’s not even about the financial cost of replacing someone. It’s the headaches and problems it causes. It’s the disruption to a team, the burden placed on others, the knock-on effect on their engagement and decision to stick or twist, the project setbacks, and the way in which our focus is taken away from our strategy all of which keeps our businesses from delivering what they’re capable of.
The answer, however, is not just to make a desperate play to keep our people when they tell us they’re ready to leave.
Staff retention is vanity, engagement is sanity, a high performing team is king.
A business full of disengaged workers is riddled with apathy. Those people come to work, pick up a paycheque, do what they have to get through unnoticed and go home. They take more time off sick, deliver minimal return on the investment in their role, and our clients/ customers have a poor experience being serviced by them or using the products they create. They show up in body, but they don’t want to be there, and that shows too.
‘Presenteeism’ (which in fairness also refers to those showing up who maybe shouldn’t for medical reasons and are therefore incapable of functioning at their best) might even be costing your business more money each year than absenteeism according to Harvard Business Review!
Gallup report the cost of lost productivity by having ‘Not Engaged’ or ‘Actively Disengaged’ employees is 18% of their annual salary (this also seems a very low estimation to me). To put that into perspective, again using the UK average salary, with global reports often showing engagement levels around 30% of the typical workplace, 70 in 100 employees not being engaged costs a business £394,191 per year. If you have a business of 1,000 employees that’s £3,941,910 while 10,000 employees equates to a paltry £39,419,100…
The measure of success is results. Results are delivered by engaged teams. Engaged teams are the emergent property of workplace cultures people want to be part of, where they feel valued and choose to give more of their discretionary effort. That’s what we need to tap into, that intrinsic motivation that makes people give their all – not because they have to (they often don’t – particularly in industries like tech where they could have another job by the end of the week), but because they want to.
The Antidote to Apathy & Attrition
The ‘Great Resignation’ is a problem and the ‘Great Re-shuffle’ is happening as employees look for a better return on their investment of time and effort. But, there’s good news – we don’t have to suffer. Organisations that look after their people and develop a reputation for doing so likely won’t feel the same effects. In fact, you might benefit as we move away from the hardships of the past two years and more and more people look for a better experience at work to have a better quality of life. You can be the organisation people choose to go to and give their all for.
The only sure antidote to counter the ‘Great Resignation,’ and a stagnant disengaged population of those who remain, is to become an employer of choice where people want to take jobs, want to come to work and want to make a difference with the work they do – because they choose to give that discretionary effort.
Employees won’t do that, they won’t go the extra mile for an imbalanced relationship with work that takes way more than it gives. Employee engagement is the antidote to high staff attrition. We need to shape workplace cultures and experiences that it’s possible for our employees to engage with.
It doesn’t have to be ‘us’ vs ‘them’, ’employers’ vs ’employees’. People will take jobs in, stay in and engage with the work they do in organisation’s that care about them and cultivate a positive experience of work that is good for their wider lives. If we do, we know that through better talent attraction, retention, attendance, and performance, our businesses will be better for it.
Work can get better for employers because it gets better for employees. When was the last time you audited your employees’ experience of work?
How can we make it better?
We created the Vibrant Workplace Challenge to help organisations who want to optimise their business performance by optimising their employees’ experience understand how people really experience work in their company. Over a 3-month period we use our web and mobile app accessible employee experience platform to:
- Evaluate life in your company
- Compile a report with recommendations on what you’re doing well and what you may do differently
- Provide you with key cultural health indicators including Employee Engagement and Employee Net Promoter scores
- If you meet our benchmark, we’ll verify you as a Vibrant Workplace which you can use as a symbol of your commitment to your people. It can help to strengthen an authentic employer and talent brand. If you need help to get there, we’ll offer our support to help you on the journey!