The Great Resignation (Or Regret)

Living and working (or taking time away from work) throughout the pandemic has made many of us rethink our careers or deeply question the role of work in our lives. It’s a phenomenon that has been felt globally as people re-evaluate and search for greater flexibility, increased income, or in many cases, a more fulfilling lifestyle. As a result, 2021 saw a global flood of worker resignations in a movement now coined as The Great Resignation or the Big Quit. From frontline workers to senior executives, research from Microsoft found that as much as 41% of the global workforce and 54% of Generation Z workers are considering changes in employment in the near future. This research stacks up closer to home, as Australians and New Zealanders also ponder new paths. This mass exodus of workers is predicted to have a noticeable economic impact – so what is driving it, what sort of impact is it likely to have and how will it affect you as an employee or employer?

What’s behind The Great Resignation

From remote working perks to new vaccination policies, there are plenty of factors contributing to a quitting trend, unlike anything that’s been seen in decades. Let’s look at the top five drivers:

• Travel could be back on the cards – as borders begin to open for the fully vaccinated in some countries, travel is beckoning those that have been starved of planned overseas holidays. Workers in their twenties may have put backpacking escapades on hold and will now be keen to get out and explore.
• Changes to flexible work perks – workers were thrust into remote working arrangements realising that not only can they do their jobs from home, but they enjoy the flexibility. With restrictions beginning to loosen, some employers are calling for staff to return to physical office premises, which isn’t always appealing.
• Burnout reaches its peak – mental health and wellbeing have taken a big hit during the pandemic. With additional household pressures and general uncertainty adding to often very long work from home hours, many are looking to shift their work/life balance.
• Employer vaccination policies – whether you are on board with vaccination or not, this is beginning to significantly impact working arrangements – both from a legal and personal point of view. While some states, territories, and employment sectors in both Australia and New Zealand have mandated vaccination, the use of vaccine passports and an unwillingness to work alongside unvaccinated colleagues have also become factors. According to this report, 58% of Australian and 51% of New Zealand workers feel uncomfortable working alongside unvaccinated colleagues – a number that has climbed quarter on quarter.
• Changing perspectives – reassessing what is important is a key driver of The Great Resignation. Whether it’s income or lifestyle-driven, many employees have been holding on to their jobs while they weather the pandemic storm and are now ready to explore new opportunities.

What will it mean for Australia and New Zealand?

In the US, resignation rates reached a record high in August 2021, with over 4.3 million people voluntarily leaving their jobs. While Australia and New Zealand also began experiencing the trend in 2021, it’s predicted that it will really hit our shores once summer breaks come to an end, and recruiting for the year ahead begins to gear up. In New Zealand, a recent survey reported that nearly 50% of workers are planning to change jobs in the next year, with people management platform Employment Hero suggesting similar numbers seeking employment changes in Australia. These record numbers of voluntary resignations are hugely expensive for employers, as productivity takes a dip and recruiting and training costs soar. It’s been estimated that the cost to the employer of replacing a departing employee is on average, a whopping 122% of that employee’s annual salary.

Resignation or regret – employee considerations

The global pandemic and resulting lockdowns have given many of us the space to reflect and reassess our lives like never before. There’s been a fundamental shift in the role of work, with many now focusing on work fitting with lifestyle rather than living the life of a wage slave. It’s important to remember though that the grass isn’t always greener, so before you leap, consider these factors:

1. Thoroughly assess your situation – the best decisions often aren’t made on a whim, so try to remove temporary emotions (such as pandemic-related fatigue) from the situation and identify what’s driving you. For example, have you hit a dead end in your current career or no longer find your role fulfilling? Talking it out with someone you trust is helpful at this point, as it can aid in separating emotion from fact.
2. Reflect on the past – think about what led you to your current role and whether it has served the purpose you had in mind. For example, was it only ever a temporary stepping stone or simply a promotion that was too good to pass up?
3. Identify what your perfect day looks like – rather than dreaming up your ideal role, think about what it is that you want to change in your day-to-day. For instance, does it start with walking the dog coffee in hand before visiting clients or firing up the laptop? Detail out your perfect workday and repeat the exercise over a few weeks to fine-tune. This will give you a good understanding of what is truly important and what changes you could make to be fulfilled.
4. Account for any negatives – are there employee perks, great friends, or stability you’ll be leaving behind as a result of a resignation? Change inevitably means compromise, and it’s important to go into it with your eyes wide open.
5. The financial factor – a career as a part-time dog walker may be your dream, but it’s unlikely to pull the same annual income as your current full-time corporate gig. As unromantic as it sounds, it’s critical to consider the true cost of resignation. Will there be downtime as you search for a new role or build up a client base? Do you have fixed outgoings that need to be covered?

6. Explore your current options – provided you’re not considering resignation because of a toxic workplace or a misalignment in values, speaking to your superiors about internal opportunities that could tick your fulfillment boxes (or perfect day plan) is a great place to start. You never know, you might just find the perfect solution without the upheaval.
7. Make a plan – starting small is a great option for the risk-averse amongst us and those not ready to take a giant leap. Once you’ve figured out your goal, look at what changes and steps you can take over the next year to help you get there. For example, are there gaps in your skillset you can plug? Do you want to build your savings to a certain level to bolster ambitions to become self-employed? Could you engage a mentor to help you on your way?

How to Big Quit-proof your business – employer considerations

With the pandemic changing the way we live our lives, so too have the factors that keep employees engaged and fulfilled. Employers need to adapt and reconfigure workplaces for the new world we find ourselves in. But how?

1. Offer flexibility – flexible working arrangements have become a game-changer for employees. Since we’re no longer chained to the office to access a fax machine or computer, or to work 9-5 pm in line with daylight hours, the traditional workplace needs to be reimagined. In fact, according to this study, more than half of employees surveyed globally would consider leaving their job if they are not afforded some form of flexibility in where and when they work. Employers need to reassess which types of work can be easily completed off-site, and when office-based collaboration is beneficial.
2. Drive growth ambitions – humans intrinsically want to be challenged. Without overstretching already fatigued staff, ensure your company has strong career development and ongoing learning opportunities in place.
3. Share purpose and values – employees are craving investment in the human aspect of work. After long periods of isolation, engage your team in the shared purpose and vision of your organisation.
4. Prioritise communication – to avoid your employees becoming a statistic of The Great Resignation, keep the lines of communication wide open. Ensure leaders are available for regular one-on-one chats so that any issues or requests can be addressed before they escalate.
5. Tailored incentives – with the pandemic giving people the opportunity to reflect on what’s important, an end-of-year bonus may no longer be relevant. Personalise incentive strategies for employees based on their unique drivers. An additional day of leave or career development opportunities may be more valued than financial rewards.
6. Play together, stay together – disconnection and isolation have been the standouts of 2021, so kick start this year with some good old-fashioned team bonding and fun. Providing social connections in the workplace boosts morale and engagement and can make all the difference in retaining employees.

The status quo has got to go

If the past 18 months have taught us anything, it’s that what was previously taken for granted has forever changed. As a result of global stay-at-home orders and lockdowns, we’ve all reassessed what’s important and the pre-pandemic workplace has been reimagined. It now comes down to how individual employers and employees react to these changes and move forward in a way that serves them best.

This article is a guide only, be sure to think through any decisions to evaluate if the change is right for you. If you’re in business and feeling concerned, consult with your HR experts or engage the assistance of an HR consultant.

DISCLAIMER

The following advice is of a general nature only and intended as a broad guide. The advice should not be regarded as legal, financial or real estate advice. You should make your own inquiries and obtain independent professional advice tailored to your specific circumstances before making any legal, financial or real estate decisions. Click here for full Terms of Use.