1 In 4 Workers Quit Their Job This Year—Here’s What Companies Are Getting Wrong About Retention

At least one in four people quit their job this year, and the share could grow before the end of 2021, according to data from the people analytics firm Visier. Its latest report accounts for voluntary departures from over 50 U.S. enterprise companies and upwards of 500,000 employees across industries.

While many employee surveys throughout 2021 forecast the share of people intending to quit, like a PwC survey indicating 65% of people were looking for a new job as of August, Visier data from January to August finds an annualized rate of 25% of people actually quit their job this year.

It’s a “substantial increase” even from 2019, says Ian Cook, Visier’s vice president of people analytics, when 22% of employees quit their job during a year of record turnover and a tightening labor market prior to the coronavirus pandemic.

“The volume at which people are changing jobs is unprecedented,” Cook tells CNBC Make It, which he says isn’t surprising given the way people have reevaluated their work and personal values during the pandemic, but it’s catching employers by surprise nonetheless.

Another record-breaking 4.3 million people quit their jobs in August, following several months of sky-high turnover throughout the spring and summer of 2021. Businesses in some industries, like leisure and hospitality; manufacturing; retail and other service jobs are especially feeling the crunch.

Cook says leaders who see today’s turnover as a result of a brief pause in their usual business operations, rather than a severe disruption among the labor force, have the wrong assumption about what needs to be done to retain and build the future workforce.

“There’s a fundamental shift in the way employees and employers need to interact,” Cook says.

Some workers are more likely to quit voluntarily than others, the Visier report notes, including those with five to 15 years of tenure, workers 40 to 45 years old, and women.

Cook says it’s crucial to note that the workers most likely to quit these days aren’t just young professionals who are more likely to job-hope due to life stage, which employers can expect and prepare for. Instead, when mid-career and experienced professionals walk out the door, organizations lose more internal knowledge and face more severe disruptions among their teams and leadership. These workers are also more expensive and take longer to replace.

That tenured employees are quitting at higher-than-usual rates makes the current moment a “unique” and “destructive event,” Cook says. While some of it can likely be chalked up to people who planned to quit in 2020 finally feeling secure enough to do so, Cook says what’s more significant is that “people are rethinking their careers, their work-life balance and how they engage in work. And that’s what employers need to be engaged in if they want to keep their employees.”

Increasing resignation rates among women are troubling for the labor force overall during a time when gender parity among many industries is still dismal.

“Every organization needs to look closely at where they’re seeing those quits, and put strategies in place to change that trajectory,” Cook says.

Cook says many employers are approaching their retention efforts today as they would in a pre-pandemic era with a one-size-fits-all approach, such as by conducting compensation reviews, creating recognition programs, conducting surveys to get feedback on employee experience levels and aligning roles and performance to market rates.

However, “this event is not like any others,” Cook notes. “You need different responses to the data.”

He says employers often make the mistake of prescribing solutions without first measuring where attrition is taking place down to the department, team or even at the individual level.

So, rather than deploying companywide surveys to measure employee sentiment, Cook recommends leaders first look at exit patterns: who’s leaving, what department they’re in and how increased departure impacts the business. This will give leaders an idea of where problems are causing real events-based outcomes, rather than measuring and averaging out employee sentiment companywide.

When businesses identify the groups most in need of help for retention, they can take targeted actions to support these workers rather than deploy generic programs and initiatives.

Cook gives the example of one company that wanted to address turnover that was impacting their revenue. When they looked at exit patterns, they found the women who disproportionately made up their share of shift workers were most likely to leave, due to inflexibility of scheduling work around child and dependent care. Managers took this data to executives, then devised a strategy to change the shift structure and ensure employees could build more accommodating schedules.

The focused approach is crucial, Cook says, even for employees who’ve already expressed intentions to leave.

“Possibly the worst response to this moment in turnover is thinking, ‘Oh, there’s nothing we can do,’” he says. “It’s always possible to dig in, person by person, what’s driving their particular decision and create opportunities in the context of what they need to change their decision.”










SOURCE: CNBC
IMAGE SOURCE: PIXABAY