As we end 2021, and our second calendar year living through a seemingly never-ending pandemic, our gaze turns to the horizon and our expectations of the year ahead. In the business landscape, one thing you’re sure to hear more about in 2022 is the Great Resignation.
Observed as a phenomenon in the USA throughout 2021, where resignation rates increased month-on-month for six straight months, we saw over 35 million people voluntarily quit their jobs this year.
So far, the Great Resignation has not yet hit Australia. However a global survey, conducted by Microsoft in partnership with LinkedIn, shows that 41%[1] of staff say they are planning to resign within the next 12 months.
If that’s the case, what are leaders to do about it?
What might cause a Great Resignation in Australia?
It’s thought a number of factors would drive a Great Resignation trend in Australia.
Firstly, we know that during the uncertain months of the early pandemic, people stayed put in stable jobs if they had them. The backlog of resignations that would otherwise have occurred is now evaporating, as those who have been waiting until economic conditions stabilise think about quitting their jobs.
The industries experiencing the strongest resignation rates are those that have been affected most by the pandemic – in particular, the health and technology sectors. It’s thought exhaustion and high workloads have predominantly driven the resignations in these industries.
Additionally, the closure of international borders has had an impact on the migration of talent across markets and into those industries. Australia traditionally relies on the interstate and overseas movement of qualified professional people to fill key vacancies. Since borders have been closed, it's far harder to recruit local talent to those vacant roles.
Staff seeking early retirement represent another cluster of people who have been quitting their jobs. However, instead of burnout being the primary driver, it’s a desire to maintain some of the lifestyle benefits that we have all enjoyed whilst working from home during the pandemic. Early retirement offers the chance to spend more time away from big cities and in more relaxed environments, without trading off time with family.
Interestingly, another demographic that is more highly represented in resignation statistics are those with a mid-career focus. It seems that people in middle management are seeking to exploit the global talent shortage and accelerate their careers more rapidly by securing challenging roles at higher salaries outside their organisation.
Younger workers wanting to secure their first promotion may also be looking externally, as the remote working trend diminishes the ability to network internally. After all, it’s hard for newbies to build their network and secure professional development opportunities inside their organisations in the best of times. It’s hard to network when you're stuck at home on Microsoft Teams calls all day. Those opportunistic conversations in the lunchroom, on coffee breaks or at work functions help to stitch together the social bonds that help people in their career journey. The pandemic has made it that much harder.
And whilst the motivation to quit can be lifestyle-focused, there is undoubtedly an economic reality to the trend too. After all, if organisations are reporting skills shortages, it's simply a mismatch between supply and demand on the labour curve. That is, employers are not paying enough to retain or attract skilled workers to the roles they have available.
What should leaders do to respond to the Great Resignation?
1. Keep your best people
The highest priority step is to retain your existing star performers. Make an honest assessment of your highest flight risks. Who is underpaid compared to the market? Who is showing signs of exhaustion from an ever-increasing workload? Whose career has stagnated from a lack of growth opportunities internally? These are the staff you’ll want to have a targeted retention strategy for.
2. Combat exhaustion
Staff facing burnout, impossible workloads, and a lack of support, present the most immediate flight risk. If you’ve got extensive vacancies in certain teams, taking action to support those left behind to cope with the extra work becomes critical. Recruit temporary and agency staff, consider internal secondments, or the appointment of a short-term executive to manage leaderless teams. Providing short-term resources and support will help people cope until staffing levels stabilise, helping to stem the long-term risk of further resignations.
3. Increase flexibility
Your best people may be able to cope with periods of high demand and high workload if they can manage their lives as flexibly as possible. If work can be performed remotely or in hybrid teams, then let your best staff develop the workplan that suits them. Insisting rigidly on workers being present in certain locations, or working fixed, unchangeable hours, makes it more likely that people will leave for employers who will give them the flexibility their family life craves.
4. Build social connections
Look for opportunities when teams are in the office to have the meetings, workshops, training sessions and social functions that help people to connect as humans with each other. Whilst working from home can provide quiet time for focussed work, the sense of camaraderie amongst colleagues helps your staff to feel supported when times are tough and increases the overall resilience of the team. As a leader, in the early months of 2022, devote more of your time to people issues than you usually would.
5. Seek talent everywhere
In a globally connected world with remote working possibilities, your next hire does not have to reside near your office. If there is good talent overseas or interstate, you might be prepared to take the plunge and give it a go. Similarly, if one of your best performers wants to move down the coast – does it mean they have to resign? If you can separate geography from employment, you suddenly have a much broader pool of talent to choose from. Be open-minded and strategic about securing the best possible people to fill your current staffing gaps – regardless of where they live.
As we move into 2022, leaders need to be alert to signs of staff movement. A few key people moving on can be a signal to others to do the same, and suddenly an irreversible trend develops. Nurture your team and spend time helping them to reconnect after the disruptive months of 2021. Consider how you might foster team development and how you might support the strongest of your internal leaders with advice from a coach or external mentor.
Beyond everything, bring to 2022 a leadership mindset that’s focussed on helping your people do their best work and feel supported to grow their careers.
Best of luck for a productive year ahead.
[1] 2021 Work Trend Index, Microsoft
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