Whether your organization has been impacted by The Great Attrition or not, you’ve likely heard plenty about how employers are struggling to retain and hire talent. Also known as The Big Quit, this trend may have been fueled by the pandemic in the beginning, but as it continues, it’s crucial for us to look at what factors are contributing to such a large portion of the workforce opting out of traditional jobs.
To kick off our series on The Great Attrition, we’re exploring the impact it’s had in the United States so far, some of the top reasons people are leaving the workforce, the industries that have been affected the most, and tips to recruit top talent during this time.
How widespread is The Great Attrition?
In 2021, EDsmart reported that 48 million people quit voluntarily and as we moved into 2022, reports didn’t show any signs of The Great Attrition slowing down. In January, 4.26 million people quit their jobs, and in February, another 4.35 million of their peers joined them.
As of May 2022, The World Economic Forum reported that the rate of employees voluntarily quitting their jobs was still 25% higher than it was before the COVID-19 pandemic.
“If we think about how many people have quit their jobs over the course of the pandemic, in the U.S. alone it’s about a third of the workforce,” observes Bonnie Dowling, Expert Associate Partner at McKinsey & Company.
And according to multiple studies performed by McKinsey & Company throughout 2021 and 2022, 40% of employees claimed they were at least somewhat likely to leave their jobs in the next three to six months.
Related: Work Environment Post-COVID
Why are people leaving their jobs?
Before employers, HR professionals, and recruiters can develop solutions to attract and retain team members, it’s crucial to assess why we’re seeing so many people exit the workforce. While the key decision-making factors vary from one person to the next, Statista has done an excellent job of compiling data on the most common reasons cited by those handing in their notice.
Here’s a breakdown of this research:
As this chart shows, many people cite a lack of career advancement opportunities and compensation as their primary reasons for leaving their traditional job roles. Uninspiring leadership, a lack of meaningful work, and an unhealthy work-life balance are also prevalent factors that have likely contributed to the rise of the gig economy.
That’s right, while traditional employers may be scratching their heads as they try to recruit new staff members, many people who have quit their positions during The Great Attrition are still hard at work—they’re just working for themselves now.
According to Zety, there are approximately 59 million gig workers in the United States. That’s about 36% of our entire workforce—and that number is growing. Statista reports that we could see as many as 85.6 million freelancers in the United States by 2027.
So why are people suddenly choosing to work for themselves instead of organizations? Well, one of the primary reasons is that people realized they could work from home during the pandemic. This increased flexibility and independence is something many workers chose not to give up when the organizations they previously worked for decided it was time to return to the office.
Some of the other reasons Zety’s research uncovered include:
· Having a variety of jobs to choose from (43%)
· Having more opportunities to change jobs (31%)
· Not having a boss or manager (22%)
· Reduced boredom and less repetitive tasks (19%)
· Competitive wages (18%)
Related: What Is the FemTech Revolution?
Other reasons employers are struggling to hire qualified candidates
People changing industries and choosing to join the gig economy are just two of the many reasons today’s talent pool seems to be shrinking. The reality is that many people have exited the workforce entirely, but when we look at the big picture, some of the reasons for this may surprise you.
Here are a few of the big ones:
· Retirement: As Forbes’ contributor Avivah Wittenberg-Cox observed in her article “Is The ‘Great Resignation’ Actually A Mass Retirement?” two-thirds of the folks leaving their jobs in August 2021 weren’t actually ‘quitting.’ They were retiring.
· Childcare: Throughout the pandemic, many parents lost the childcare support their families relied on as schools, nurseries, and daycare centers closed. Even as these options opened back up after COVID-19 lockdowns, there are plenty of parents with young children who determined that the cost of childcare is simply too expensive to justify returning to a full-time job. In fact, 48% of survey respondents told the Pew Research Center that the primary reason they left their jobs in 2021 was due to childcare issues.
· Caretaker Responsibilities: While childcare might be top of mind, The Washington Post states that “four times as many Americans are out of work taking care of adult family members than those who stopped working to care for children during the pandemic.” Today, caregiving is the second-largest factor keeping people out of work, following closely behind early retirements.
Of course, we also need to acknowledge that not everyone opted out of work voluntarily during what has been declared The Great Attrition. As of October 21, 2022, over one million Americans have died from COVID-19 and many more have sustained long-term health complications. While it is not pleasant to remind ourselves of this fact, it is important to understand that the size of our workforce simply is not the same as it was in 2019.
This is why employers can’t afford to ignore the people who have stepped out of the workforce voluntarily. As Bonnie Dowling explains, “there are not enough people in the workforce to fill the number of jobs we have openings for” in the United States, which means we need to consider how we can bring people who may have retired or paused their employment back in.
Related: 5 Tips to Become a Resilient Leader
What industries have been impacted by The Great Attrition the most?
While you’re unlikely to find an industry that hasn’t been impacted by the ongoing employment challenges presented by COVID-19 and inflation, there are some areas that have taken a harder hit than others.
According to EDsmart, the industries with the most voluntary resignations include:
· Accommodation and food services
· Leisure and hospitality
This data isn’t surprising when we remind ourselves that many of the job roles in these industries are in-person, customer-facing positions that often pay a low hourly rate. While these employees were hailed as essential during the height of the pandemic, we continue to see this demographic advocate for livable wages and improved worker rights.
As more remote work and freelance opportunities become available, it makes sense for employees who have felt slighted by their employers throughout the pandemic to explore opportunities in lower-risk industries that offer higher rewards.
Of course, this doesn’t mean that all employers in accommodation and food services, leisure and hospitality, or retail are out of luck.
While we are seeing more employees voluntarily leave these industries, Bonnie Dowling points out that the high churn we’re seeing “is striking across all levels, from frontline employees to executives.”
What this does mean, however, is that employers in all areas need to listen closely to what types of benefits, work culture, opportunities, and compensation people are looking for when applying to a variety of jobs.
In other words, restaurant owners are no longer competing with other restaurant owners in town to hire the best local talent. Instead, they may be competing with a wide range of companies in different industries, local and remote.
In fact, The World Economic Forum and Statista both report that 65% of people who quit their jobs have not returned to the same industry. Therefore, employers and recruiters need to think holistically about the types of compensation packages that are currently available to the workforce.
Related: Reach Your Long-Term Goals With The Three Horizon Framework
How to recruit and hire qualified candidates during the Great Attrition
If there’s one thing we know for sure, it’s that the tried-and-true methods organizations have used to recruit and retain employees in the past simply aren’t working anymore.
Compensation is table stakes. If you’re not providing candidates with a competitive salary or being transparent about how much you’re willing to pay them upfront, you’re going to have a tough time getting talented job seekers to apply, let alone accept your offer.
As the job market becomes more candidate-driven, it’s time for employers, HR professionals, and leaders to rethink the way they find new talent and what they’re able to give to the workforce to attract talented individuals to fill job vacancies.
Numerous employers are choosing to implement candidate-centric recruiting methods to identify what people are looking for so they can encourage them to apply to work for their companies. Candidate-centric recruiting is a form of recruitment that emphasizes building relationships with job seekers over time.
Organizations that implement this technique strive to identify what potential candidates need during each phase of the recruitment process to attract and hire the most qualified people to join their teams.
Here are some tips to move away from the traditional employer-centric recruitment model and toward a candidate-centric one:
· Map out the candidate journey: Analyze your current recruitment, hiring, and onboarding processes to get a better understanding of the complete candidate journey. Focus on key areas, like your job advertisements, the application process, online interactions with applicants, and interview strategies to identify areas for improvement.
· Assess your employee value proposition: To develop a well-defined set of values and benefits you can offer your team members, start by researching the incentives your competitors are offering. Then, think outside the box. While competitive compensation, sign-on bonuses, healthcare, and tuition reimbursement are all popular offerings, there may be additional benefits you can provide that will set you apart from other employers. Examples include childcare reimbursement, pet insurance, and office stipends for remote workers.
· Keep your job candidates informed: Once a candidate applies to work for your organization, keep them informed about the hiring process by sending them automated updates, such as text messages, emails, calendar invites, and reminders. Look for ways to streamline processes, shorten the hiring timeline, and sustain the interest of your top candidates so they feel valued.
· Ask for candidate feedback: Throughout each phase of the recruitment and hiring process, ask for candidate feedback to get a better understanding of how they feel and where you can improve. Consider using short candidate experience surveys to gather insights about your recruiters, benefits package, career website, and application. Then use this information to continuously optimize your strategy.
It’s also important to understand that not all job candidates are looking for the same types of benefits or compensation packages from their employers. Developing candidate personas can help you understand what goals, skills, experiences, needs, and desires qualified job applicants may have in common in your industry.
In my next article, we’ll explore five of the most common employee personas and share tips to make them want to join your team, so stay tuned as we continue to dive into ways your organization can thrive amidst The Great Attrition.