The Great Resignation Trend of the 21st Centurysuzette
In Google’s 2021 search trends, it showed that more people searched for “how to start a business” than “how to get a job in 2021”. In the world of work, there is a new term making its way onto every social media platform possible, namely, “The Great Resignation”. While this might sound like a historic event or a literary work, it is in fact our current reality.
The trend was first reported in mid-2021 in the United States and Europe as the Covid-induced lockdowns were extended over and over again. Anthony Klotz, Professor of Management at Texas A&M University, coined this phrase “The Great Resignation” – also known as “The Great Quit”. The phenomenon describes the record numbers of people leaving their jobs as the Covid-19 pandemic continues. A similar trend was reported in South Africa shortly after, with skilled workers contemplating new jobs, semigration and emigration as they reconsider their past career decisions. Rashida Kamal, a writer for The Guardian, states that 2021 was the year that workers quit their jobs at historic rates. These numbers hit a high in September 2021, when roughly 4.4 million people left their jobs.
What gave rise to it initially?
According to Klotz, this trend is one of the main repercussions of the pandemic on the world of work. It could be said that the trend is driven by an economic and psychological shift as employers struggled to motivate anxious employees to return to industries that have often treated the workers as inessential. A terrific shift has taken place over the last few years that has given workers a sense of something priceless, self-worth.
During the pandemic employees where required to work longer hours with no boundaries, and the “side effects” thereof are starting to show. Employees are feeling overwhelmed, overworked, undervalued and under-appreciated, and the decision to quit their jobs rather than continue to endure this treatment is the aftermath. Remchannel, Old Mutual Corporate’s reward-management platform, states that 88% of companies who responded to their wellness and performance survey said that their staff were working longer hours. Further, it showed that 32% of said employees were expected to be fully available telephonically or via email outside of traditional working hours. The reality is that employees were working too hard, because they were being subjected to travel restrictions and they had fewer opportunities and reasons to leave their homes and toxic workplaces. As a result of this rut that they were stuck in, they simply gave up.
How does this affect businesses?
There are two main ways in which “The Great Resignation” affects businesses negatively, namely higher staff turnover and trouble with attracting new talent. René Richter, Managing Director of Remchannel, said “the cost of higher staff turnover and accrued leave, which is registered on the company’s books as a debt, indicates a liquidity risk to corporate SA. The pattern of burnout, toxic workplace culture and a drop in productivity suggest a ticking time bomb.”
Furthermore, almost 69% of the remuneration survey participants, which includes HR and reward professionals, indicate attracting new talent and retaining current employees is a major problem. Some employees are deciding to leave in order to pursue lifelong dreams and establish a new career. The pandemic surely produced a few professional home cooks, renewed someone’s passion for art and music or inspired individuals to build their own brand. Other employees noticed how valuable their time with their family was and may have decided that they wish to spend more time with them. These reasons are all passion- and emotion-driven which makes it much harder for businesses to convince employees otherwise.
How do we combat this?
In South Africa, our situation is always more delicate. South Africa has recently faced a record high unemployment rate of 34,9% in the third quarter of 2021. The ability to walk away from a job in a job-scarce economy is often not within reach. However, employees still started choosing to move on with very little caution. There has also been a global shift in attitude, resulting in workers asking to re-contract with their employers. With that in mind, South African businesses should rather think of the situation as “The Great Renegotiation”.
All in all, “The Great Resignation” is something to be aware of, however there are opportunities for businesses to combat this. A great starting point would be for businesses to be willing to work smarter, restructure and renegotiate in order to fit the new demands of the changing workforce. This could be done by encouraging hybrid workforce models, adjusting the leadership / management styles, investing in the social welfare of employees, introducing flexible working hours or having employee value programmes.
Effectively, businesses need to assess their current organisational climate, determine what is working for them, what is not, the possible reasons for workplace issues and then strategise around that. The best and most effective place to commence would be to engage in open and transparent dialogue with your employees – that is the only way you are going to know what is going on in their minds. An excellent way to engage in this process would be in the form of a Climate and Culture Assessment. The results thereof can be used to develop unique and tailor-made strategies to reduce your turnover and improve the wellness of your staff.
If you’re considering such an exercise, feel free to reach out to us to discuss the process in further detail!