Welcome to the Great Resignation.
The November figures are the highest ever recorded since the US Labor Department began tracking these numbers more than 20 years ago. So, why are so many people quitting? Economists and labour experts point to several reasons, including a tighter labour market, low-paid workers looking for better opportunities, employees looking for more flexibility, childcare issues that disproportionately affect female employees and a general re-prioritisation in how people want to spend their time.
This mass exodus of workers looks like it will continue for the foreseeable future. In a recent survey by the staffing firm Robert Half, 41 percent of American workers indicated they planned to look for a new job in the first six months of 2022. Twenty-eight percent even said they are willing to quit before getting a new job. In Europe, one study of employees in the Netherlands showed that 46 percent of workers planned to quit their jobs in the next six to 12 months — but only 30 percent of HR decisionmakers reported talent retention as a top priority.
As the balance of power shifts from employers to employees, companies will need to revisit their current recruitment and retention tactics if they are to stay competitive. Here are four key strategies for companies to consider in order to attract the best talent — and keep current employees happy.
Embrace remote and hybrid work
Survey respondents cited more flexible work hours and the ability to work remotely as driving factors in searching for a new job.
Over the last two years, most companies have had to shift to remote and hybrid work. This change would have been unimaginable even a decade ago, as executives and managers often worried about how productive employees would be while working from home. However, the pandemic has changed this sentiment to some degree. One survey of employers found that 44 percent believe employees need to be in the office only two to three days a week for their organisations to maintain a strong workplace culture. However, another 21 percent of employers surveyed said that threshold was five days a week. Employers in the latter category are likely to get left behind as employees leave for job opportunities that offer more flexibility.
Remote and hybrid work are now the new normal, and many workers have proven they can work effectively from home. Companies that want to retain their existing talent and recruit new talent should consider offering more flexible work schedules. This could mean requiring only two or three days a week in the office, implementing remote work Fridays or meeting-free Fridays, or requiring in-person meetings only when teams need to collaborate face-to-face to kick off big strategic initiatives. The right approach will vary by organisation, but what's most important is that companies embrace a mindset that where work gets done isn't as critical as how effectively it gets done.
Boost employee benefits and compensation
Employees want to feel valued, and often the best way employers can express this is by offering a more attractive compensation package.
This can take the form of perks like a one-time retention bonus, enhanced 401(k) contributions or a reduction in employee out-of-pocket costs for healthcare premiums. Boosting benefits also can help companies recruit and retain new and current employees. Expanded sick and family leave programs, offering several weeks of paid sabbatical to long-time employees, and expanding mental health benefits are some options companies may want to consider as a way of demonstrating to employees how much they value their contributions. For companies operating in multiple countries, it’s important to carefully evaluate options for offering benefits abroad.
Develop a clear path for advancement
For employees to stay, they must feel like they can grow with the company. But sometimes, the promotion process can feel too opaque to employees or it’s unclear why the company promoted one person over another.
To resolve this, employers should consider talking to employees about their career goals and what they see as their future with the organisation — an exercise known as career mapping. Managers can then create a career progression plan for high-potential talent in conjunction with these employees.
If budget allows, companies also should consider investing in training and continuing education programs that upskill their existing staff. These programs also will indicate to employees the company wants to help them acquire the skills and knowledge they need to advance their careers — producing a win-win for both employers and employees. Mentoring and job shadowing programs that pair employees with internal leaders in the roles they aspire to also can help employees progress in their careers and potentially foster a greater sense of loyalty that encourages them to stay.
Focus on diversity, equity and inclusion
Organisations that embrace the diverse backgrounds of their workforce benefit in the form of new ideas and perspectives. Research shows that inclusive workplaces are often more innovative and higher-performing.
However, the Great Resignation likely will make it harder for companies to maintain a diverse workforce when so many of their employees are leaving and they have to contend with worker shortages. Still, companies should make a concerted effort to integrate diversity, equity and inclusion (DEI) into their hiring practices and overall culture.
Companies can start by creating transparent DEI goals that they share both internally and externally — whether it's to increase the number of women in executive leadership positions by five percent in five years or to develop pipeline programs with workforce development organisations and local colleges that predominantly serve historically underrepresented groups.
They also should consider creating an internal DEI committee and ask diverse, high-potential employees to participate in these initiatives and contribute their ideas. This approach simultaneously will increase accountability within the organisation and allow high-potential employees to demonstrate their leadership skills and increase their visibility. Companies also can conduct regular engagement and inclusion surveys to gauge their progress and identify potential areas of improvement.
Embrace a new workplace paradigm
The Great Resignation and the pandemic are redefining the future of work. Employees now crave more flexibility, and in a tighter job market, they have more leverage to negotiate higher pay and better benefits. Companies that want to recruit and retain the best talent should use all the resources at their disposal to meet these needs head on and develop a proactive talent management strategy. By doing so, they can lead the way in a competitive talent marketplace and build a skilled, high-performing team that drives top results.
For more information, watch our webinar, "How multinational employers can attract and retain talent in a time of employee empowerment."
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The contents of this article are intended for informational purposes only. The article should not be relied on as legal or other professional advice. Neither Vistra Group Holding S.A. nor any of its group companies, subsidiaries or affiliates accept responsibility for any loss occasioned by actions taken or refrained from as a result of reading or otherwise consuming this article. For details, read our Legal and Regulatory notice at: http://www.vistra.com/notices . Copyright © 2022 by Vistra Group Holdings SA. All Rights Reserved.
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