If you ask a typical business owner what keeps them up at night, employee retention is likely at the top of the list. Thanks to record resignation rates across industries, it’s no wonder why. The Great Resignation has been making headlines since mid- 2021, with many business leaders wondering how to guard against attrition. In no uncertain terms, employers need to adapt to shifting employee needs—at least, if they want their business to survive.
So, how can executives keep their top talent during the Great Resignation? Before answering this question, we first need to understand what the Great Resignation is and what is driving people to quit.
What Is The Great Resignation?
Simply put, the Great Resignation refers to the increasing rate at which workers have been quitting their jobs since the spring of 2021. Spurred by the easing of the COVID-19 pandemic once vaccinations became more readily available, this trend saw quit rates as high as 2.9% in the U.S.
Since the start of this quitting trend, researchers have demonstrated that resignation rates are high across the board. It’s not unique to one industry, and both men and women are leaving at comparable rates. Poor retention is affecting employers across the world, not just in the U.S.
Why Are People Quitting?
Employees leave for various reasons, and it’s not always about the money. According to research published in MIT Sloan Management Review, some of the top predictors of attrition during the Great Resignation are:
- Toxic Corporate Culture – 10.4x more likely than compensation to contribute to attrition.
- Job Insecurity and Reorganization – 3.5x more likely than compensation to contribute to attrition.
- Failure to Recognize Employee Performance – 2.9x more likely than compensation to contribute to attrition.
COVID has also changed peoples’ attitudes toward work. According to the Gartner 2021 Hybrid and Return to Work Survey, a majority of participants experienced a shift in perspective toward their jobs during the pandemic. COVID-19 caused:
- 65% to rethink the place that work should have in their life.
- 58% to change their perspective toward their workplace location.
- 52% to question the purpose of their day-to-day job.
Here’s How You Can Combat The Great Resignation
1. Offer Fair Pay
The first thing to look at when developing a strategy to retain employees is whether you are offering competitive pay and salary increases. According to the Mercer U.S. Compensation Planning Survey, compensation budgets are expected to increase in 2022.
- 36% of organizations’ budgets increased by less than 3%
- 53% increased by 3-3.49%
- And 11% increased by over 3.5%
For August of 2022:
- 16% of organizations’ budgets are expected to increase by less than 3%
- 71% are expected to increase by 3-3.49%
- And 13% are expected to increase by over 3.5%
For November of 2022:
- 12% or organizations’ budgets are expected to increase by less than 3%
- 61% are expected to increase by 3-3.49%
- And 27% are expected to increase by over 3.5%
As you can see, many companies are prioritizing compensation this year to keep their employees.
2. Build a Strong Culture
Building a strong organizational culture can lead to more engaged employees. Engaged employees are more likely to strive to meet the high standards their leaders set for the team. Creating a culture that values work-life balance is essential if you want to instill loyalty and increase motivation. 3. Focus on the Essentials Strategic focus is an essential part of achieving your business goals. What a business decides to focus on can lead to growth or failure, which can impact retention. If your strategy sessions don’t produce plans that are clear, implementable, and compelling, you may need to be more focused. Do your plans feel muddled? It may be time to revisit your company’s mission and vision.
4. Structure for Resilience
Is your business structured to be resilient in the face of challenges? If not, the next time disruption occurs, you may need to make drastic cuts to your budget, which could mean letting go of key team members. Losing anyone from your team can be damaging to morale.
5. Develop Trust
All successful relationships require trust, and work relationships are no exception. If you have not made efforts to build trust with your team, start by focusing on three core areas: follow through on your commitments, prioritize effective communication, and show respect. For some businesses, it may also be necessary to rebuild trust that has been damaged. To begin rebuilding trust, it is essential to acknowledge any damaging events that transpired, take small steps to rebuild trust (the same process to build initial trust above), and be patient.
6. Get to Know Your Team
For workers to become invested in an organization, they need to feel like their lives matter to those in charge. One way to instill this feeling is to simply get to know your team. When you and your team members know each other personally, any problems that arise are less likely to lead to drastic reactions, such as resignation. Personal relationships in the workplace can act to hold a business together in this way.
7. Build Respect
Many people in leadership positions think that a job title automatically grants them respect from their colleagues. However, respect is earned, not given, and teams that have a universally respected leader are more likely to go above and beyond to reach goals. If you want to earn respect at your business, you need to set and meet the high standards your company stands for, admit mistakes when you make them, and always have your team’s back. Interested in hearing more about how to overcome the Great Resignation? Join GFX at my talk on Saturday, September 3 at the ATRA Powertrain Expo!