What is “The Great Resignation?”
In July 2021, more than 4 million people quit their jobs in the United States, as per the U.S. Bureau of Labor stats. The resignation gets to its peak in April followed by a few months. This leaves many companies without good employees. But the question is how can an employer retain a good employee in the face of this resignation wave?
To get to the root cause of these stats can begin with better understanding them. It is important the reason why there has been a recent shift. For this various companies carried out in-depth analysis considering employees from various sectors, different experiences. On this basis of the analysis, the two trends came into the limelight.
- Mostly, employees of the mid-career are resigning.
It is seen that the employees between the 30 and 35 age had the greatest increase in the resignation rates. While there is less resignation is encountered for the employees between the age 20-25 and 60-70. There are some factors that explain the highest rate of resignation for the mid-age employees.
After the pandemic, employers thought of not investing more in people with little experience as it would be riskier. Also, they have to conduct training for hiring new employees thus increasing the demand for the mid-career employees and creating more new positions for the mid-career people. This has created a huge workload for the employees and they have reached the breaking point, causing them to rethink their work-life goals.
- Tech and health care industries are highly impacted
Different companies had faced a huge difference in their turnover rates. For some industries, the resignation rates were low such as manufacturing and finance. But on the other hand industries such as healthcare and tech faced a huge resignation rate. The resignation rates were high for the employees who worked in those departments whose demand had increased after the pandemic, resulting in a huge workload.
Steps to be taken by employers to retain employees
This type of analysis based on data has helped the companies to understand how many people are quitting their job along with who has the highest turnover risk. It is important to understand why people are leaving, and what steps need to be taken to prevent that.
The steps taken may vary from company to companies but there are a few steps that will help employers for improving employee retention.
- First, you need to determine the main cause of the turnover at your company. It is important that you understand the scope of the problem and how it is going to impact your business. You can use the following formula for calculating the retention rate.
Number of Separations per Year ÷ Average Total Number of Employees = Turnover Rate
Also, check the turnover is coming from the voluntary resignation and the layoffs. This way, you will get an idea of where the retention problem is coming from. Then you need to understand the impact of the resignation on the business. As such a huge resignation will lower down the motivation of other employees as they feel without the resources.
- Then you need to find out the root cause of why your employees are leaving. You need a self-assessment to understand the factors that are resulting in higher resignation rates. Some factors like compensation, tenure, performance, hikes, etc.
- After you understand the weak spots, now you can run in-house retention programs that will try to understand the demands of the employee who want to leave.
Having a great employee will definitely help in increasing the turnover of the company. So it is the responsibility of every company to hold on to their good employee for getting long-term benefits.