Turnover during the Great Resignation is impacting companies of every size and industry. A sudden increase in employee turnover isn’t something you ought to ignore, hoping it miraculously adjusts to pre-COVID numbers. Employee turnover has a direct impact on company revenue and profitability. It is also attributed to decreased productivity, increased recruitment costs, lost sales and time spent on retraining. Companies are starting to realize that they’ve got to identify why workers are leaving in droves, causing operational issues that have never been experienced before. Many tend to think that the mass exodus is directly assigned to pay, but a January 2022 study by MIT suggests otherwise. According to the study, the number one reason people left their jobs was for toxic culture, followed by job insecurity and reorganization, high levels of innovation, failure to recognize performance, and poor response to COVID-19. Surprising to some, pay ranked 16th in this study!
What else is driving this workforce phenomenon? Additional contributing factors include:
Baby boomers are leaving the workforce
2 million people retired who were not expected to retire
Women stayed home to act as caretakers, and they have not reentered the workforce
Entrepreneurs increased by 24% during this period
Nearly 1 million people have passed from COVID – a significant percentage were working individuals
The birthrate has been going down over the last 70 years
Although we are seeing COVID infections decrease, sadly, we can’t say the same for voluntary resignations. Time Magazine reported that economists predict that the Great Resignation is only getting started, especially for Gen Z and millennial workers who are well-positioned to find new ways to earn income. What does that mean for companies? For one, it means that companies should be proactive in making people management issues a top priority. These issues should be on the list of strategic initiatives that your leadership team is tackling. Why? Quite simply, you cannot get anything done without people. It is very difficult to recruit good talent and equally difficult to retain them.
If you’re like most organizations, you’ve already experienced the impacts of the Great Resignation. Although you may not be able to change the minds of those who have already made the decision to leave, you can cut turnover by doing these four simple things.
Improve Engagement Through Stay Interviews
The number one reason employees stay, or leave is dependent on how much they ‘trust’ their immediate supervisors. You’ve heard the adage “people don’t quit jobs, they quit bosses/managers”. One way managers can promote trust and improve engagement is to find out what their employees need. This can be done through a concept called a stay interview. A stay interview is a structured discussion a supervisor conducts with each employee to learn the specific actions he/she must take to strengthen employee engagement and retention. Information learned during stay interviews should bring forth information that can be used immediately on each individual employee. They should also position the supervisor in a solutions seat. To increase the likelihood of conducting stay interviews, managers should be assigned retention or turnover goals and should be required to report progress monthly. These interviews do not need to be lengthy. Five to six questions should be sufficient. Questions such as:
What do you like least and most about working here?
If you can change anything about your job, what would that be?
How do you like to be recognized?
When was the last time you thought about leaving our team; What prompted it?
Would you recommend our company to job seeking friends?
Stay interviews may not keep people from leaving your organization, but they will certainly help managers get a hold of valuable information that can be used to retain employees.
Employee Recognition Program
A well-executed employee recognition program can increase retention within your organization. It's all about feeling seen and valued when you do excellent work. When employees feel appreciated and recognized for their contributions, they will be more connected to their work, their team, and your organization. A recent study by Deloitte showed that organizations with recognition programs had 31% less turnover than those without. A poll conducted by Quantum Workforce and Bamboo HR found that 52.5% of employees want more recognition from their immediate manager. Creating and implementing an employee recognition program can keep your employees engaged. Depending on financial resources, it may behoove you to start small. Building an employee recognition program doesn’t have to cost an arm and a leg. Check out our blog on meaningful recognition ideas that can be implemented immediately and on a budget.
Put Employee Development First
The COVID pandemic financially impacted many companies and to survive budgets got cut. In many cases, professional development budgets were amongst the first benefits to get sliced. Although this may have served as a quick save, eliminating professional development opportunities can cost your business in the long run. According to data from a recent EdAssist survey, 60% of respondents said that they’d choose a job with strong professional development opportunities over one with regular pay raises. Professional development opportunities provide employees with an opportunity to maintain and obtain the skills required for their current roles and can provide skills required to move up in their career path. Employees who do not see a clear path within your organization are at risk of leaving. So, put employee development first.
Promote a non-toxic work environment
Toxic workplace culture is one of the five drivers that is contributing to the mass turnover experienced during the Great Resignation. What does a toxic workplace look like? The MIT study referenced earlier found that the leading elements that causes a toxic culture include failure to promote diversity, equity, and inclusion; workers feeling disrespected; and unethical behavior. Oftentimes, toxicity creeps up gradually. What was once a minor issue can eventually become large enough to now cause good employees to consider leaving your organization. It’s important to address toxic environments within your organization as soon as they are identified. If left alone, the result will be increased employee absenteeism, high levels of stress, unhappy employees, and high turnover. To promote a work environment free of toxicity, start with two-way, meaningful communication. Make your employees feel valued and empowered to raise issues that may be contributing to a toxic workplace. If issues are raised, be prepared to address them at an appropriate level. Workers do not stay in toxic work environments, so take care to let your diversity, equity and inclusion initiatives build a healthy work environment that employees can thrive and grow in.
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