Rising employee resignation rates are not new—they’ve risen every year since 2010, in fact. But halfway through 2021, previous records were shattered, with 1 in 4 people actively searching for a new job. In addition, industries across the board are experiencing voluntary turnover. Surprisingly, it’s not only happening in businesses where you’d expect it, such as quick-serve restaurants and healthcare, but also in industries like professional services, finance and IT.
This unexpected wave is forcing companies to ask themselves: What’s driving this labor disruption? People are resigning for the same reasons they previously have, of course—the pandemic is only accelerating the trends. To start, employees are experiencing an overwhelming feeling of burnout. They’re desperate to ditch dead-end jobs. They’re having a hard time striking a work-life balance. And, of course, they quit for every company’s favorite reason: a bad boss. All of these scenarios, and no doubt several others, are how we have arrived at the Great Resignation.
Companies facing these challenges must consider why this is happening and what can be done to stop the overturn. Could this be a moment of learning? What if we invested in our leaders?
It’s time to dig deeper, as there’s more to the story than meets the eye. Talented people are longing to break free from constraints, learn new skills, and reinvent themselves. One in four workers are actively looking for a new job, while 80% say they’re concerned about career advancement, and 72% say the pandemic motivated them to reassess their skill sets. Talented people are restless, and that’s a great thing—your business needs ambitious people. This is why the Great Resignation might be beneficial for your business, as it forces leaders to consider how their company is attracting and retaining talented employees.
Investing in leadership is essential—frontline managers, coaches and mentors, directors and VPs—because leaders disproportionately impact HR performance metrics like engagement, retention, job satisfaction and internal mobility. But it’s important to keep in mind the influential role leaders have in an organization. They’re core to employees’ happiness, and a lousy leader can not only sour a company’s reputation but lead to a high turnover rate.
If we want employees to have better lives, we have to give them better leadership. A study recently found that “relationships with management” is the top factor not only of an employee’s job satisfaction but the second most important determinant of their overall wellbeing (second only to mental health). Managers have an outsized impact on two universal qualities of a productive culture: psychological safety (no one feels motivated by fear) and good work organization (everyone knows their value and enjoys areas of autonomy).
Let’s consider the three things great leaders do. The best leaders give employees a sense of control over their lives, create a a transparent and fair workplace, and continuously motivate and inspire top performance. Below, I’ve outlined some advice to help great leaders get started.
1. Give people a sense of control.
• Effective onboarding brings new hires up to speed 50% faster. Plenty of studies over the years have reached similar conclusions. New employees need to feel a sense of control right away; they need to know how things get done, who to talk to, where to go for advice, big and small.
• Many employees need to get paid more often than twice a month. Earned Wage Access (EWA) is a simple but powerful software that gives employees access to some of their accrued wages before the end of the payroll cycle. This simple technology can provide workers with more control over their financial lives.
2. Create a fair and transparent workplace.
• Be an open book. Show employees their total compensation (benefits, paid leave, insurance benefits, learning and development offerings, etc.). Explain the company’s approach to salary benchmarking, pay equity, and career advancement. Explain how your company is pursuing its DE&I strategy.
• Employee benefits are changing , and communicating on this topic is critical. Organizations that survived the most disruptive days of lockdowns became experts at over-communicating. Consider approaching benefits with the same transparency, first by opening a dialogue with employees to better understand their needs, and then, close the loop by guiding them in their decision-making.
• Open up a real time dialogue with employees. Listen to what they have to say and act on it, where possible and appropriate. Look for HR tech that can help assist the process.
AI-enhanced employee sentiment software turns written words and survey data into actionable insights enabling executives to lead the organization empathetically and strategically through whatever disruption comes next.
3. Motivate and inspire.
• Help team members identify career paths within the company. Career management software can radically simplify complexity in this area by helping identify key roles and skills, resolving the vague expectations that hamper performance, and map all employees’ goals to the organization’s objectives and key results. Bonus points for a solution that helps managers make feedback, coaching, and career momentum part of the culture.
• Help employees become lifelong learners with a range of robust training programs. From high-touch options, like mentoring and coaching, to self-paced learning, employees who are learning new skills will be too engaged to look for another job.
One day, we’ll stop referring to the “new normal” and just say “normal,” but unfortunately, even when that happens, the so-called “war for talent” will never end. Every demographic, educational and social trend points to a talent shortage for years to come; however, that shortage doesn’t have to impact your business—not if you invest in your leaders.