Enticing and keeping top talent has become ever more challenging with an extended labor shortage and people leaving the workforce due to COVID-19. Studies predict that every time you replace a salaried employee, it costs 6 to 9 months of salary. You will lose productivity from that role, experience a negative cultural impact, and decrease team engagement.
The Great Resignation is top of mind for HR pros as workers are quitting their jobs and switching companies, and even career paths, in droves. Catalyzed by remote work and the pandemic, many employees have had the time outside of the workplace to reflect on what’s best for them and their families when it comes to career and balance of life issues.
There are various reasons people are seeking a change. For some, the pandemic hastened a shift in priorities, encouraging people to chase a new opportunity, transition to part-time work, or even become stay-at-home parents. However, for many, the decision to quit came because of how their employer treated them during the pandemic.
That was the case for Roberta. A long-time manager for a large independent oil and gas company in West Texas, she found herself back in the office after only a brief closure. Roberta was uncomfortable about her safety and saw her stress and workload increase while managing additional work and long hours in the office that she had good reason to believe was unsafe. She voiced her concerns but felt unheard. She felt belittled and unappreciated. It became clear to her that while HR was saying all the right things in their various communications to the media and employees, the reality in the office was completely different.
Ultimately, Roberta decided to quit rather than continue working for a company where she felt unappreciated. She says it was a tough choice because she had been with her previous company for nine years and was friendly with co-workers in and outside of work. However, it was clear to her that the company was only virtue signaling for political reasons. She found an opportunity in the same industry with a company that allowed her to work remotely. She makes about the same amount of money and feels that her new company appreciates her and cares enough to address her concerns about safety in the workplace. She no longer must commute every day, and she doesn’t miss the expensive dry-cleaning bills for office clothing. Best of all, she can perform her work from home, turn in assignments, eat healthier foods during lunch, and spend more time with family.
Roberta’s story is not uncommon. Workers decide to leave based on many factors, not the least of which is how their employers treated them or didn’t treat them during the pandemic.
Change That Lasts?
Might this Great Resignation bring about meaningful, long-term change to workplace culture and how companies invest in their employees?
To most experts, the answer is yes. The transformation was happening before the pandemic, with a real surge in what individuals are watching for regarding their expectations of companies.
In March 2020, billionaire entrepreneur Mark Cuban appeared on a CNBC special titled Markets in Turmoil and warned companies not to force employees back to work too soon. “How companies respond to that very question is going to define their brand for decades,” he said. “If you rushed in and somebody got sick, you were that company. If you didn’t take care of your employees or stakeholders and put them first, you were that company.” For many employees, cautioned Cuban, “that’s going to be unforgivable.”
By The Numbers
According to the US Bureau of Labor Statistics, hiring leaped up in August 2021, with monthly job growth averaging 586,000. Still, job openings continue to increase, and the time to fill roles has also been lengthening. Among the unemployed, the number of job-leavers (unemployed persons who quit or voluntarily left their previous job and began looking for new employment) increased by 164,000 to 942,000 in the summer. Recent
poll of US workers found that 95% of workers said they are thinking about looking for a new job, indicating the job market could continue to present hiring challenges for HR and Talent Acquisition pros for the foreseeable future.
Remote Work-The New Reality
A CNBC worker survey shows 76% of employees want flexible remote work options. A recent survey from Brazen Associates found that 39% of respondents would look for a new job if their current employer did not offer a remote work option. Remote and hybrid work flexibility has emerged as a highly coveted and expected benefit for employees, along with excellent healthcare plans (including mental health), more PTO and sick time, maternity and paternity leave, and long-term health leave.
Offering employees the choice to work remotely has become non-negotiable, and employers need to listen if they want top talent.
Studies repeatedly demonstrate that every time you replace a salaried employee, the total cost is six to nine months of salary, depending upon the position. Employee turnover is costly for employers. According to Glassdoor, the average company in the US spends about $4,000 just to hire a new employee, taking up to 52 days to fill a position. It’s become compulsory for companies to invest in their employees’ wages, opportunities, ad wellbeing. It’s simply good for business. When many people are moving, it costs companies in terms of turnover and lost productivity. It takes an average of nine months to onboard someone to be fully effective in their new position. Companies that lose a lot of their workforce are going to struggle. Companies that don’t invest in their people will fall behind.
The New Competitive Reality
Today’s hiring backdrop is more competitive than ever, and missing out on top talent affects the bottom line. A company’s end-product is only as good as the talent behind it.
For those businesses that experience high levels of turnover, time and money will be dropped into new employee training and onboarding, all while working to prevent burnout and further turnover with the current workers picking up the slack of departed peers while ramping up the new. It’s a vicious cycle.
As we sit at the tip of the great resignation, there are a few crucial steps companies can take to retain talent when it matters utmost. Leverage virtual technology solutions, embrace the hybrid workforce, offer meaningful benefits, and listen to the wants and needs of existing employee
By Bill Raney, Eureka Recruiting firstname.lastname@example.org