One of the biggest discussions over the last few weeks has been on the topic of the so-called “Great Resignation
”. The idea is from prof. Anthony Klotz
from Texas A&M University that last May forecasted an increase in attrition from many roles.
The numbers are multiplied, he says, by the many pandemic-related epiphanies—about family time, remote work, commuting, passion projects, life and death, and what it all means—that can make people turn their back on the 9-to-5 office grind.
During the summer, as many businesses recover from the most important effects of the pandemics, a staggering number of openings
built-up in many sectors. In the US these numbers are particularly high among mid-career workers and in Healthcare and Tech, according to an HBR article
, with a few other sectors
also hit, particularly in Retail
A partial explanation of this trend, especially in the US, is linked to the fact that companies have been quick
in laying off employees as soon as the pandemic hit hard. Accompanied by economic incentives, people did not come back immediately to their former employers when the recovery started. This is, however, only a part of the story. Other researchers suggested there is a sign of renewed “power” by employees, again a trend probably more visible in the US. This is also linked to new unionization initiatives and strikes
, a trend that seems to be contagious also to countries like China.
The problem, as with many events that are too early to be really labeled as trends, is that we are making some big and dangerous generalizations
. We need more data, and we need to wait to see if some distorting elements (like stimulus, economic support, etc.) are impacting these trends. Yet, some alternative views are building up, based on initial thoughts of what might be causing these resignations.
Maybe it’s just a Great Realization
, pointing out that in a moment of market expansion the market becomes dominated by candidates. Or maybe a Great Retrospect.
Josh Bersin calls it The Great Migration
, as he points out a trend of people trying to move to organizations that are more focused on “good work” rather than crummy Jobs
My observation point in Italy
- Italy has had a particular situation during the pandemic: shopping malls have been closed over weekends for most of the pandemic period (with the exception of a few categories like food). This has created a situation by which many retail employees have experienced an office-like working week for many consecutive months, without working Saturdays and Sundays. So in many apparel retailers, for example, there is a surge of resignations in shopping malls, after the re-discovery of “quality time” over weekends.
- We are seeing an increase in the number of employees resigning as they move to different sectors, with a particular increase to public sector jobs (partly also linked to new hires by the government).
- We are seeing an increased number of employees leaving without a specific alternative. This is particularly visible due to a distortion of current social security measures in Italy. We are seeing much higher rates of job abandonment events. The consequent termination for just cause leaves the person with the option to still get unemployment benefits for up to 18 months.
- In general, there is a difficulty in hiring for new roles in Retail. The team is having more difficulties than before in hiring for full-time positions, and especially for managerial roles.
There has been a narrative, particularly last summer, whereby the biggest problem in attracting candidates was the existence of competing social security benefits. I think this is only one element to consider when addressing the problem. For sure there has been some impact, but it is limited to specific roles. On the other side, I also don’t think the issue is only limited to salaries. In Italy, retail salaries are higher than in some other countries (compared to minimum or living wages). It’s true that there exists a wide “grey” area of employers not fully respecting national contracts and salary levels. But the trend is affecting both small and large organizations, showing that compensation is only part of the picture.
Impacts on Organisations
Whatever the trend above suggests, organizations are facing unprecedented pressure on their recruiting
and talent attraction
(and retention) processes. We all know what the cost of attrition
can be, thus the pressure is real for many organizations.
Some economists are worried this may hit hard on the overall economic recovery process. Yet I think this trend is having more of a lasting, cultural impact, and is especially focused on a generational rift. Not just an age element, though, but a shift in work paradigm for many.
During current hiring processes, what is being asked by people boils down to basically three requests:
Being treated like individuals capable of autonomously performing their jobs.
Being allowed to manage their entire selves as a “whole”, away from the myths of work-life balance which separated work and personal lives.
- Being allowed to find an alignment between their personal goals and the meaning they give to work.
The problem is that in too many organizations the answer to these questions is seen solely based on their Smart Work implementation programs
. The fact is that only a minority of jobs can still be performed remotely. And while technology advancements will continue to allow for more work to be performed from the distance, nurses, sales associates, drivers, logistic associates, restaurant waiters, and so on are all jobs that are location-based
This is where I see a strong responsibility for organizations to move and explore particularly the third “ask” by current and prospective employees. It’s not just about defining a purpose for your organization. That can help, for sure. But we risk falling prey to the same error seen for the smart working discussion: assuming that all jobs can be linked to individual purposes. Yet we know that many people have different interests in their lives, and use work to support these priorities. We need to look at solutions that allow an individual to pursue its goals independently from the company one.
The example is Mario (the person is real, the name is fictional). I met him some year ago during a recruiting process for a Store Manager role. He had an impressive CV, having worked with many of the best high street brands, but had a 6 months hiatus. When asked what he was looking for, he made it crystal clear. “Together with my partner, we have adopted twins. It has been a life-changing experience, and I have taken 6 months off to focus on them. Now they will soon start school, so I don’t need to be home all the time, and I want to go back into the business. Yet I want to make sure I’m home Saturday and Sundays, to spend as much time with them as possible.” I can only wonder how many doors he already got shut with such a request. A Store Manager is easily a 24/7 role in many companies, and with weekends being the busiest days of the week, you can’t make up with such a request. He had the perfect competencies, not the best availabilities. Over dinner, we chatted with the line manager… and we decided to give him a try. Not without difficulty with all the “exceptions” this guy created, for which we had to suggest a starting salary that was lower than his peers.
In just 3 months he made the store one of the highest performing ones in the area, showing that he had the right competencies. Yet, he did not choose the brand because of its “purpose”, he could have worked at any apparel retailer. He wanted to work for somebody that allowed him to pursue his priority in life, whereby his job was simply a way to support his life as a father.
Is your organization ready to address each Mario that is out there?
Because this is the question that we need to address in a candidate-driven labor market
. We can then build the necessary HR processes and tools, starting from a good Employee Experience, to address these.
The Great Responsibility
This is why I think that today’s challenge is dealing with this Great Resignation with a focus on the Great Responsibility that each organization holds. Offering options to its employees to pursue their goals, with autonomy and in ways that allow their selves to flourish.
Not an easy goal to achieve, uh?
What do you think?