A predicted “turnover tsunami” has arrived, spurred on in part by the shift to remote work, according to experts.
Before the pandemic, employers were seeing high rates of turnover, SHRM, a human-resources association, reported at the time. Then, during the pandemic, the level of people quitting their jobs reached its lowest ebb in nine years. But with an economic recovery in sight, the association forecast four months ago that employees would pick up where they left off in their job searches.
“There is absolutely pent-up turnover demand in the U.S. workforce,” Danny Nelms, president of the Tennessee-based research and consulting firm the Work Institute, told SHRM in March.
Nelms noted that before the pandemic, about 3.5 million employees were leaving their jobs each month before dropping to 1.9 million in April 2020 as the health crisis deepened.
Now, the number of job quitters is surging again.
According to the U.S. Labor Department, 4 million Americans left their jobs in April 2021, the highest number ever recorded.
Quitters can afford to be choosy
Economists told The New York Times in June that there were several reasons for the high number of quitters, and all were pandemic-related:
- There was a backlog of people wanting to quit. During the pandemic, fewer people than normal quit their jobs, but now, with the economic recovery, they feel they can.
- Demand for workers has risen quickly during the recovery period, giving workers confidence that they can find a new job quickly.
- Many workers saved money by working remotely during the pandemic, allowing for a cushion of savings to tide them over if they are unemployed while searching for work.
- During their time working remotely, some people have reflected on their career and lifestyle and may be searching for work that allows for more flexibility, such as remote work, and the ability to spend more time with family.
Burnout, benefits, balance
There are several reasons for employee dissatisfaction with their current jobs, according to experts.
Burnout was cited by most respondents who said they would quit their job this year, according to a November 2020 survey by the Washington D.C. consulting firm Eagle Hill Consulting. The same poll found that 25 percent of U.S. employees plan to leave their jobs as the pandemic subsides. The number is higher for millennials, and people with children at home.
Another study by Toronto software company Achievers and published in March 2021, found that the top two reasons for quitting are better compensation and benefits (35 percent) and better work/life balance (25 percent). It also found that since the pandemic, 46 percent of employees feel less connected to their company and 42 percent felt their company culture had diminished. Only 21 percent felt very engaged by their job.
“Companies need to think differently and strategically about how they’re going to hold onto their top talent. Otherwise, it will be even more difficult for a business to bounce forward in a post-pandemic economy,” Melissa Jezior, president and chief executive officer of Eagle Hill Consulting, said in a statement.
What employers can do
Rather than just filling the exact same jobs with similar profiles, Jezior advises a more thoughtful approach.
“Companies default to backfilling roles with the same skills,” she told SHRM. “But bouncing forward means identifying and cultivating new skills through upskilling, reskilling and in hiring practices.”
Advice for employers from Eagle Hill includes:
- If companies need a new business strategy post-pandemic, as many (if not most) will, creating and filling jobs must be aligned with the new strategy.
- “Bounce forward, not back.” Identify and cultivate new useful skills. “For example, as companies introduce automation during the pandemic, many may discover that they now need people with more analytical skills and less transactional skills,” the firm said in a statement.
- Think creatively about filling jobs. Allowing remote work, gig workers and partnerships may make the talent pool deeper.
- Make sure top employees are engaged by offering job training and being explicit about their career path. Conduct “stay interviews” to find out what employees perceive as both good and bad about the company.
There’s also the old-fashioned enticement of paying workers more, as The New York Times points out that Amazon, Bank of America, Chipotle and McDonald’s have done.
Even in normal times, turnover is costly for company in terms of the bottom line, as well as productivity, morale and company reputation, Eagle Hill said. In today’s environment, companies also must deal with recovering from the pandemic and driving growth in a whole new business environment.
It is best not to wait for the wave to crash, the consultants advise.
“The better approach is to get on higher ground now with capacity and workforce planning,” Eagle Hill said.