"Great Resignation": Why now and what to do?



This pandemic brought some changes that are here to stay. One of the top challenges is called "Great Attrition", a rare situation of people dropping out of the workforce in mass, over half of them resigned even before they got a new position. While the US unemployment rate is approaching its pre-pandemic level per Recent research by Microsoft, the 2021 Work Trend Index, 41% of the workforce is considering leaving their employer this year.


The voluntary attrition has caused unprecedented labor shortfall across the board. With US population growth slowing for years because of lower birth rates and decreasing net international migration, mortality rates are rising due to the aging of the nation’s population. With the impact of the COVID-19 pandemic, this combination has resulted in a historically slow pace of growth (0.1% in 2021, 0.2% in 2020). With this "perfect storm" for the labor market, the mitigation strategy has to be long-term and sustainable.


Other statistics show similar results. According to the Labor Department, a record 4 million people quit their jobs in April 2021. The reasons cited include the perspectives brought by seeing the fragility of lives,

  • "Is this what I would like to spend 8+ hours/day on?"

  • "Is this place offering me the opportunities to move into appropriate roles?"

  • "Can it help me to grow?"

In this supplier's market, talent retention is getting even tougher for SMB employers who may not compete with larger employers on compensation and comprehensive training and career advancement structure.


To retain and attract new talent, companies need to continue adapting to changing needs. To start with, companies may need to look into new talent pools that were overlooked before to get better ROI for their talent investment. However, many of them have to be reconfigured to reflect the unique challenges of this "Great Attrition":


RECRUIT THE RIGHT TALENTS


1. Smarter Pipeline for Talent Recruitment


For the ever-expanding gap between open positions and the number of people looking for a job, smarter employers have to consider looking at broadening the talent hunting arena, e.g. looking beyond those "Employment ready" candidates to include those who show promising potentials and most importantly, have the "passion" and natural talents to be successful with the career.

2. Onboarding and orientation

A good onboarding process is one of the key components that impact the success rate of new talents in the new position. Today's onboarding process, teaching new employees their job responsibilities the company culture, and how they can contribute to and thrive in it. With more virtual working arrangements, these onboarding and orientations may need to be extended to months rather than days for the messages to sink in.



KEEP THE TALENTS


3. Effective Motivating and feedback

The usual annual performance reviews are not sufficient, especially in more virtual working arrangements. The employer may need to outsource to 3rd party mentors/coaches to talk with their employees about their short- and long-term professional goals and help them visualize their future with the company, more importantly with their career paths with potential career advancement scenarios together and lay out a realistic plan for reaching those goals.


4. More Efficient Ongoing Training


With today's knowledge update cycle shrinking every year, the days when one's school education can put one in a career lasting a whole life are gone. Employers need to provide more efficient training programs to shorten the training to almost JIT approach.


With the more and more frequent training contents update, more and more companies are outsourcing job skill training. However, most of these training programs do not provide services for identifying areas for professional growth, such as the need to learn new skills as most of them are "hammer looking for a nail".


These shifts in the labor market, e.g. "Great Resignation" are more likely to stay. Couple with other social and technological trends, the education and training infrastructure, especially for jobs and careers, may need a fundamental recreation vs. the overall "process line" school systems that have been pumping out the maximum number of trained labor resources with minimal cost of standardized curriculum.


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