In 2021, The Great Resignation caught economists off guard and disrupted businesses in most industry sectors. As organizations face continued disruptions in 2022, Evolve Your Performance, LLC is offering practical advice and targeted training programs to help mitigate the risks posed by mass resignations.
Workers quit their jobs in near record numbers for 8 months straight in 2021. The Great Resignation was initially believed to be a short-term issue related to COVID health concerns, pandemic child care challenges, and a temporary migration away from expensive cities to less-expensive cities and suburbs during office shutdowns. However, labor shortages continue in 2022 with no signs of relief.
And things may be about to get worse. According to Joblist’s U.S. Job Market Report: Q3 2021, “73% of currently-employed workers say that they are actively thinking about quitting their jobs.” With a hot job market, employees have options. Given that employee retention is critical to the long-term survival of any company, the possibility of high-performing employees quitting is now a looming threat to business operations and strategic goals. “Organizations that don’t address this critical issue immediately may face serious financial consequences in 2022,” according to Dr. Mary Barnes, CEO of Evolve Your Performance, LLC. “In this environment, it’s not always possible to replace employees who have specialized skills and business knowledge. Lowered headcount starts to create bottlenecks and constraints. Retaining your best employees is imperative right now. This issue can’t be ignored anymore.”
EMPLOYEE RETENTION AS AN ESSENTIAL COMPETITIVE ADVANTAGE
Employee retention and engagement are a pivotal foundation to overall company performance and growth in a myriad of ways, including:
- Improved profitability
- Retaining and transferring critical business knowledge
- Maximizing productivity, efficiency, and quality
- Reducing disruption and instability due to staffing shortages
- Adapting to external forces
- Creating and deploying innovative solutions
- Reducing costly hiring and training expenses
- Ability to hire better qualified candidates due to strong online reputation as an employer and employee referrals
Companies with strong employee retention have a clear advantage over those who don’t. In order to improve retention, it’s important to have a complete picture of what’s fueling the resignations.
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UNDERSTANDING THE TRUE CAUSES OF LOW EMPLOYEE RETENTION
In November 2021, 3% of workers quit their jobs. There were just 6.8 million unemployed to fill 10.6 million jobs. This job seekers’ market has motivated employees to consider the impact that the pandemic has had on their jobs and their lives and look into their options.
ADP Research’s “People at Work 2021: A Global Workforce View”, a survey of 32,471 workers in 17 countries, delivers new insights into how employees have fared during the pandemic. While not all of the news is bad, employees have been hard hit in a number of ways. Layoffs and pay cuts have shaken worker confidence and security. Unpaid overtime has jumped to 9.2 hours per week. More than 3 in 5 employees are reportedly underpaid. And 67% of workers report that the pandemic has forced them to compromise on their personal lives. According to Martha Bird, Chief Business Anthropologist, Global Strategy at the ADP Innovation Lab, the pandemic’s disruption and struggles have many employees questioning how to live a life of meaning and purpose both inside and outside of work. This has led some to pursue a life where their values are part of their workday and they are valued as a whole person at work.
While the factors influencing this trend are many and complex, valuing workers and respecting their personal values is a leadership issue that is firmly within the organization’s control. Even so, in larger organizations, low employee retention is rarely a company-wide phenomenon. That’s because employee engagement is directly impacted by a supervisor’s leadership engagement. In Gallop’s report, State of the American Manager, researchers found that 35% of managers were engaged and 65% were not engaged or were actively disengaged. Just 30% of the workers were engaged. The cause and effect relationship was so explicit that the report states, “Until organizations can increase their percentage of engaged managers, they have little hope of increasing their percentage of engaged employees.” This issue will be discussed at an upcoming complimentary online event, “Evolve Your Leadership or Perish”, on January 24, 2022.
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