The Great Resignation: What is it and what does it mean for business in 2022?

For the past (almost) two years, our lives have been dominated by Covid and its impact on public health. But many other aspects of society have borne the brunt of the pandemic, too, such as small businesses, the economy at large, and the employment sector. Chances are, you’ve heard of The Great Resignation – and…

For the past (almost) two years, our lives have been dominated by Covid and its impact on public health. But many other aspects of society have borne the brunt of the pandemic, too, such as small businesses, the economy at large, and the employment sector. Chances are, you’ve heard of The Great Resignation – and while it’s something employers couldn’t have predicted back in early 2020, it’s definitely playing out in different ways for them now.
 
What is The Great Resignation?
 
The Great Resignation was a term first coined in the US by Texas-based university professor Anthony Klotz, and it was used to describe a trend of higher-than average quitting rates for American workers over the pandemic.
 
While there are lots of reasons people might quit their jobs in such vast numbers, a few common themes emerged that experts tend to agree on.
 
Workers who suffered burnout during the pandemic were motivated to seek out more meaningful work and jobs that offered a better work-life balance
The trend towards working from home during Covid left many with a clearer idea of the type of work environment they wanted, or the job they wanted to do
Lower-wage workers found they had more opportunities to earn more by changing jobs
Workers realised they didn’t necessarily have to live near work and started switching employers with more flexible working policies
The pandemic caused many of us to re-evaluate our lives and priorities, and work has been a big part of that.
 
Is it quittin’ time on Aussie shores too?
 
The Great Resignation isn’t evident in the data for Australia (yet), but a mass exodus of employees quitting could be around the corner – probably in the new year once people have had time to have a break, consider their future and look for roles that are a better fit.
 
And although we may not be on par with the US in terms of quitting rates, there’s no doubt Australia has an ongoing skills shortage in many industries. There are hundreds of thousands of jobs going in hospitality, engineering and teaching, but no one to fill them, say experts.
 
And findings from Microsoft’s Work Trend Index, which surveyed over 30,000 workers across the globe earlier this year, suggested that 41 percent of the entire global workforce are considering resigning in the next year – with remote work opportunities driving the shift.
 
What does it mean for local businesses here?
 
Firstly, it could make it much harder for you to recruit skilled and trained staff.
 
Investing in young people and offering them the chance to upskill, train and transition seamlessly to the workplace from colleges or universities is key, say industry experts.
 
It’s also really important for employers to offer existing employees the chance to upskill and have career progression, as it’ll help them stay engaged.
 
What else can employers do to retain / keep staff?
 
Treating your employees well will always be at the top of the list when it comes to staff retention, say careers experts. Don’t let them reach breaking point.
 
Looking at any gaps in your management style or toxic culture is also important, especially if you think there are communication issues. Microsoft’s Work Trend Index found that leaders are ‘out of touch’ with employees and ‘need a wake-up call’. It also pointed to flexible work being here to stay, and talent being everywhere in our new ‘hybrid’ world.
 
Looking at why staff might leave and pre-empting it if you can is also key. Is it how they’ve been treated? Could it be down to salary or too long between promotions? Are pay increases too low? Or is there a lack of training opportunities? Is there a lack of flexibility or are decisions made that don’t take the wellbeing of staff into account? All of these can be redressed by employers in order to retain staff and keep them happy.