What Is Fueling The Great Resignation and Today's Labor Shortage?
The statistics are alarming:
- A record-setting 10.1 million job openings in the U.S. (Bureau of Labor Statistics, Sept. 8. 2021)
- 11.5 million workers quit just in Q2 of this year
- 41% of the global workforce would consider leaving their current employer within the next year
- 54% of Gen Z are considering quitting
The Great Resignation is a mass, voluntary exodus from the workforce. It is here, and it is quite real. Turnover is nothing new, and neither are corporate retention strategies. But The Great Resignation and extreme turnover happening today across so many industries are different and require a different approach. The Great Resignation caught many business leaders flat-footed.
What is fueling The Great Resignation?
There are numerous reasons, most originating from the pandemic that started in early ‘20. According to a LinkedIn survey, 74% of respondents said the time spent at home had caused them to rethink their current work situation. More than 50% cited stress and burnout in their job as a reason for looking elsewhere. Others did not like how their employer treated them over the past 18 months, with reasons ranging from a lack of genuine concern to being forced to take concessions while senior executives didn’t. The WFH dilemma opened a Pandora’s box for employers and employees alike, and has become a contentious in many organizations. And finally, yes, the increase in unemployment benefits caused a lack of urgency for many to return to the workforce.
We saw a booming economy during the past decade, resulting in most businesses losing focus on the customer and their own employees’ experience. Businesses must stop thinking Ping- Pong tables and Friday happy hours, and instead work to create a strong company culture.
A professional awakening
For many, the pandemic has been similar in its effects to people who survived a near-death experience. It has caused employees to reevaluate their professional careers – not only what they want, but also what they are no longer willing to tolerate. However, too many leaders are using The Great Resignation as a crutch. A significant percentage of people who have quit over the past 15 to 18 months say it is a result of a poor company culture, whose leaders are focused solely on productivity and bottom-line profits.
I have seen firsthand that the companies with the strongest company culture – long before the pandemic – are significantly less affected by the so-called labor shortage. The organizations that churned and burned their team members, or that paid only lip service to having a great workplace culture are the ones being hit the hardest by the employee turnover.
The biggest mistake companies are making right now
You can’t hire your way out of a bad culture.
Too many companies today are trying to solve their staff shortage issue by hiring people as fast as they can just to fill positions and are keeping employees with bad attitudes – both huge mistakes. “A” players hate working with “B” and “C” players. Unengaged employees are like squatters taking up space and sucking the energy out of your organization.
The #1 priority for businesses today must be to focus on keeping their top talent by improving their internal culture. Stop trying to find great employees. Instead, focus on becoming the type of business great employees find!
The businesses with the highest engaged employees enjoy:
81% less absenteeism
33% less turnover
10% increase in customer loyalty/engagement
23% more profitability
“Stop trying to find great employees, focus on becoming the business great employees find.”
Businesses must stop treating their employees like children. Leadership must be about helping people reach their potential in performance, not managing them from breaking policy or screwing up. High performers need innovation; innovators need autonomy. Don’t let one poor employee ruin your organization’s freedom and flexibility. Employee freedom means they can take a lot of risks and fail. Risk taking breeds innovation. Innovation breeds success.
10 ways to build the culture employees will love
- Love your employees and show it
- Do not compromise on who you hire or keep
- Prioritize employees’ mental and emotional health
- Measure employee engagement quarterly (using surveys)
- Improve the quality of your employees’ lives
- Stop policing them and start inspiring them to reach their fullest potential
- If your team is virtual, increase your one-on-one meetings
- Constantly share vision, direction, and what is in it for them
- Demonstrate that you genuinely care for your employees
- Set up a system for leaders to “catch” employees doing something right
Days of lighting fires under people are over. Days of lighting fires inside people are here.
John R. DiJulius III, author of The Customer Service Revolution, is president of The DiJulius Group, a customer service consulting firm that works with companies including Starbucks, Chick-fil-A, Ritz-Carlton, Nestle, PwC, Lexus, and many more. Contact him at 216-839-1430 or email@example.com.
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