Please Stay: How Companies Answer the 'Great Resignation'

BY Michael Stahl | September 12, 2021

In a recent job posting, a Tennessee trucking company offered pairs of qualified drivers a $30,000 signing bonus to join their team. Amazon has offered more than 750,000 U.S. workers the opportunity to pursue a fully paid bachelor’s degree. Microsoft said it would delay its return to the office “indefinitely” because forcing employees back to the workplace prematurely during the pandemic would be “shortsighted,” its CEO said. Meanwhile, according to a new Benefits Trends Survey, 69% of employers say they plan to “differentiate and customize their benefit programs over the next two years.”

This heightened level of care and concern about workers is emerging in the midst of the “Great Resignation,” the recent mass exodus of workers from their jobs, in which 11.5 million U.S. employees quit in just the three months of April, May, and June. It left the country with a record-high number of job openings in July and a huge question looming over Corporate America: What are employers going to do about it?

Coinciding with wide vaccine availability this past spring, the pent-up wave of resignation letters is being received as a referendum on business management, suggesting that many organizations during the Covid-19 crisis failed to meet the changing needs of workers.

Before the pandemic arrived, employers competing in a tight labor market were already actively improving conditions for employees. They’d learned that happy workers are more productive workers, which in turn can improve customer satisfaction. To combat employee burnout, organizations enhanced paid time-off programs and began providing mental health coverage. They also supported important social causes to help build brand reputation and boost employee morale.

However, the conditions wrought by the pandemic compelled new employee demands, and reinforced a growing sense among workers that they deserve better treatment. For working parents in particular, greater flexibility and better benefits became necessities.

“People were at home for a long period of time and they began to see their life differently,” Jason Walker, chief people officer at Thrive HR Consulting, told From Day One. The labor force was being asked to work “tremendous amounts of hours because they were at home,” Walker observed, and companies “intruded on that personal time.” Eventually, he said employees seemed to collectively realize “there’s more to my life than my work,” setting off a wide-scale reprioritization.

As we progress toward a post-pandemic world, organizations that prioritize the employee will be best positioned to hire and retain top talent. Here’s how leaders can respond to this reinvigorated spirit of employee empowerment:

Pay at Least the Market Rate

Not only has the labor market been flooded with dissatisfied workers, thousands of businesses have also reopened since spring, providing candidates a glut of opportunities. For hourly laborers as well as highly trained and experienced specialists, it is now definitively an employees’ market.

Job candidates are already cashing in on their leverage, which means it makes good economic sense for an organization to retain the best workers they already have. In addition to the time and effort spent on the hiring process, there are fees for recruiters and advertisements for open positions. There could be travel costs accrued, too, and expenses for training. Furthermore, there’s a loss of productivity while the search for a replacement plays out, among other detrimental effects from turnover.

To keep good employees around and attract the finest candidates on the market, companies have to be in tune with current pay rates and eagerly meet them. “If you’re under-paying, you’ve got to fix that fast,” said Amy Zimmerman, chief people officer at Relay Payments, a digital compensation platform. “It’s going to be a lot more expensive to get people in to replace the folks that you’re losing.”

In response to the current labor market conditions, Syndio Solutions, a platform that measures pay equity across organizations, is posting the salary ranges for all open positions in the company. CEO Maria Colacurcio said this maneuver gives “​​prospective hires consistency that reflects our values” and “respects the staff already at Syndio.”

If employers are not aware of market rates, Colacurcio said, when new hires engage in work comparable to that of other employees, they risk generating “potentially unlawful disparities, if you slice that by gender, race or ethnicity.”

Colacurcio posed an additional concern: “What happens when someone who’s been at the company realizes someone in their same job who was hired three months ago is making 30% more?” That, she said, could lead to more employees writing letters of resignation.

Adi Ignatius, editor-in-chief of Harvard Business Review, said his organization recently asked managers to identify the most important members of their team and determine whether they’re compensated adequately, compared to their peers inside and outside the organization.

“Instead of waiting for somebody to say, ‘You know, I just got a job offer from Fortune,’” Ignatius said, HBR wants to avoid “scrambling to make a counter offer” and is doing its best to “get ahead” of the head hunters.

Increase Flexibility, Day-to-day and Long-term

While fair compensation remains a focus for many members of the workforce, in pandemic times, pay is not at the top of everybody’s priority list. Instead, job flexibility appears to be of utmost concern.

“Covid really accelerated remote-work adoption,” said Clay Kellogg, CEO of Terminal, an employment-services platform that focuses on remote engineering teams. “It really went from an early-adopter market for remote work–you had some very forward-leaning companies [embracing it]–to now it’s mainstream. We did that within a 12-month period. It’s incredible.”

Study after study reveals that the overwhelming majority of workers want some semblance of remote work in their schedules, whether it’s a hybrid model, with both remote and in-office hour requirements, or the achievement of complete work-from-home status. After social distancing necessitated the shift, people are more familiar with remote work, and apparently appreciate its benefits, of which there are many.

“You really can’t unring that bell,” Kellogg said. “The old model was the result of legacy [thinking] and now we have people who say, ‘Look, that’s what I want. If I’m not going to get that flexibility option from my employer, I’m going to look around.’ And it’s a lot easier to look around when you’re working from home.”

Kellogg points out that if companies are willing to have their employees work remotely, leaders have to come to grips with new costs, covering necessities like laptops, Wi-Fi, and comfortable workspaces in the home.

But employees today want other kinds of job flexibility too. For them, staying with the same company over an extended period of time, while remaining fully engaged in what they do, means changing roles. Jeanne Schad, talent solutions and strategy practice leader at Randstad RiseSmart, a corporate consultancy firm, said many of her company’s customers are now interested in building internal-mobility programs.

Having adjusted to working from home, employees are reluctant to give it up (Photo by Visualspace/iStock by Getty Images)

“We often talk about the ambitious employee who has mastered their role and is ready for something new being a big retention risk,” Schad said. “By making internal roles easier–and safer–for employees to find, you can solve the needs of the ambitious, bored, burned out, and looking-to-downshift career employees.”

According to a Prudential report, 80% of workers who are planning to switch jobs post-Covid are choosing to do so out of concern over career advancement. More than a third of workers polled in a Robert Half survey say they feel “stuck” in their careers since the pandemic began. Providing employees the chance to change jobs within an organization inspires them to learn new skill sets, leading to more motivated, engaged, and productive workers, among other benefits.

“The biggest barrier for most companies to internal mobility is the mindset and orientation of managers,” Schad said. “Managers aren’t incented to share talent and in some cases, they can be penalized for unwanted turnover on their team–even if the employee moves to a new role internally.” Some clients she has worked with have created KPIs for managers who develop and then redeploy workers, “encouraging managers to share talent,” Schad said, “and bonusing them when they do.”

Adapt to the Presence of Different Generations  

Though this figure has been disputed by some, in 2014 the Brookings Institution predicted that 75% of the global workforce will be of the Millennial generation. One way or the other, the Millennial professional presence is growing, and Oxford Economics reported this year that within a decade, roughly one-third of the workforce will be members of the next generation: Gen Z.

These younger employees are already effecting change, says Brittany Hale, CEO of BND Consulting, a firm that focuses on retaining talent and developing company culture. Some Millennials are old enough to have attained senior management positions, while many Gen Zers–people born between 1997 and 2012–are either finishing grad school or making their way up the chain of command themselves.

Their value systems are notably different from those of previous generations, and they’re apt to evangelize about them on social media. There, Hale said, “you can see any number of skits about what a ‘fast-paced environment’ means.” In Millennial and Gen-Z minds, she said, that kind of approach to work means: “Goodbye to your life.”

“It’s not that they don’t have a good work ethic, it’s not that they don’t take pride in their professional integrity, but they’re looking for more of a work-life balance,” Hale said. She added that when corporate leaders don’t realistically consider “the changes and trends of your talent pool, and you’re expecting them to adapt to you,” the result is “mismanaged expectations.”

Given those conditions, in a time of crisis like the current pandemic, Hale said, work is not seen as a place for support, but instead as a stressor. And that leads to turnover.

However, not all members of the older generations have bought their retirement homes just yet. “There are some companies that have five different generations in their workforce right now,” says Suzanne Rohan Jones, a talent-management specialist at Graybar Electric, a Fortune 500 company that specializes in distribution and supply-chain management. Older employees might not understand why Gen Z workers would want a hybrid-work model or robust flexibility in career paths, she said. Leaders need “to be sensitive to the strengths and challenges of each of those different generations,” said Jones, who is also an adjunct professor of psychology at Maryville University.

Be More Transparent Than Ever

With the emergence of younger generations in the labor force and the prospect of radical changes to the workplace, which will include less time spent among peers and managers at the water cooler or snack bar, employees of today expect transparency from their leaders. “In the absence of it they’re making stories up,” said Amy Zimmerman from Relay. “In the absence of information, people assume the worst, unfortunately.”

Zach Jones, managing partner of the Phenom Consulting Group, an executive-search and talent-optimization firm, suggested that managers lead by example and “be living proof” of whatever they’re delegating to their team. “Being involved is critical to someone knowing, Alright, this person is in the trenches with me; I have confidence in them and what our direction is,” Jones said. It’s no longer acceptable, he added, for workers to hear from managers, “Here are your marching orders, report back to me.”

Jones believes managers must be open to scheduling more one-on-one facetime with their employees, even if the meetings are held over video-conferencing platforms. Leaders need to discuss not just the performance metrics, but how their workers’ careers are going and the ways in which they want to grow, hopefully within the company.

Another way leaders can earn the trust and confidence of their employees, especially given recent events, is to construct what author Diana Hendel calls a company-wide, rapid-response process. “Companies don’t do a very good job, frankly, of preparing for catastrophe,” said Hendel, a pharmacist and former CEO who worked for years in a hospital setting, where she once experienced an active shooter event. She recently co-wrote Trauma to Triumph: A Roadmap for Leading Through Disruption and Thriving on the Other Side, an undertaking that began prior to the pandemic, and became even more urgent once Covid-19 struck.

A rapid-response process can look different from organization to organization, but Hendel describes it as simply a set of protocols that ensure company leaders will be able to meet with each other when disaster strikes, make informed decisions, and assign responsibilities. When a crisis emerges, she said, a signal such as a “code blue” can be relayed to workers.

“What it does for employees, even people who aren’t involved directly in having to respond to the code, when they hear ‘code blue,’ they know things are being taken care of,” Hendel said. “They can expect information to come when it’s available. They’re not left wondering, Who’s taking charge? They know.” Even if the rapid response process is never engaged, having it in place and understood by employees provides perpetual peace of mind for everyone in the workplace, she said.

Be More Compassionate Than Ever

More than fair pay and perks like unlimited cappuccinos, young workers today want respect. But employees of any age can appreciate that sentiment, considering the collective trauma Covid-19 delivered. “Think about the authenticity of your leaders,” said Mina Morris, a partner in the Human Capital Solutions practice at Aon, the professional-services firm. Leaders should strive to be “more connected” and “more humble,” Morris said, and consider how they can “simplify work” in ways that help people remain “better connected with their tasks.”

At the same time, he added, leaders should try whenever possible to remove the “urgency when we don’t have that ability to be in person, and really sift through priorities,” he said. “So really connecting on an individual level, a human level,” Morris continued, “is a really important part of the journey.”

Evoking that spirit of empathy, leaders at Emtrain, which provides training on workplace ethics and culture, recently shortened the company’s workweek to four days. “It’s giving everyone a beat so that the temperature and the pressure starts to simmer down a little bit,” said CEO Janine Yancey. “People’s internal pressure barometer is just too high [right now] and it just starts to become an emotional reaction where they have to leave.”

Yancey believes the emergence of younger generations of workers has made issues like mental health more prominent. She says the pandemic, as well as the murder of George Floyd and, more recently, the events in Afghanistan, have all spurred a shift in priorities for workers.

“When you see the traumatic consequences of this pandemic and losing people that you love, losing people that you know in the community,” Yancey said, the thinking becomes: “I’m not just going to be a mindless robot with my nose to the grindstone every single day. I’m going to think about what’s important because life is precious.”

Michael Stahl is a New York City-based freelance journalist, writer, and editor. You can read more of his work at MichaelStahlWrites.com, follow him on Twitter @MichaelRStahl, and order his first book, the autobiography of Major League Baseball pitcher Bartolo Colón, at Abrams Books.


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Emily McCrary-Ruiz-Esparza | September 24, 2024

Election Stress in the Workplace: How Leaders Can Respond Without Taking Sides

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While there’s no federal mandate that employers give workers the day off to vote, some states do, and many companies provide flexibility on election day. Encouraging workers to vote is a good way to acknowledge what’s on their minds without taking a political position.If you’re curious about what other organizations are doing or need to back up a recommendation to leadership, check out Time to Vote, a non-partisan business group launched in 2018 that believes “workers shouldn’t have to choose between earning a paycheck and voting.” With more than 2,000 member companies including VISA, P&G, and Target, the organization is attempting to bridge the legislative gap and increase voter turnout. Patagonia, one of the companies that founded Time to Vote, has been giving its employees Election Day off since 2016. 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Large employers like JPMorgan Chase and Meta and others announced they would cover travel costs for employees who are seeking legal abortions out of state.   Keep the Focus on Empathy and Employee Support “Organizations need to say it’s a polarizing time, and that could be impacting how you show up at work,” offers Tracy Avin, Founder of TroopHR, a human resources peer group with more than 1,300 members and 15,000 LinkedIn followers. 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Then you can tell them to take a day off or provide mental health resources as needed.”Additional outlets for employees might include a moderated Slack channel or an employee resource group (ERG). “What’s most important is that employees know where they can go for support,” says Leonora Wiener, an executive leadership coach and former chief operating officer of Consumer Reports. Communicate Early and OftenAt Consumer Reports, Wiener helped lead teams through the 2016 and 2020 elections, the racial-justice reckoning after George Floyd’s murder, as well as the pandemic. She stresses the importance of listening to employee concerns and actually asking your staff what kind of support they are looking for. “Oftentimes organizations aren’t that good at finding out what their ‘internal customers’ need,” she said, adding to make sure any feedback groups are diverse and include representatives from all generations and backgrounds. In terms of communications, her philosophy is lather, rinse, repeat. “People need to hear the same message many times, and it needs to be said through different channels. Not everyone reads Slack or emails, and not every manager delivers the message in the same way.” Start that election communications drumbeat today, she says.Don’t Go It Alone Josephs echoes that sentiment, recalling how much “over communication” was required during the pandemic and other recent events. She also points out the added pressure and increased responsibility borne by HR and people leaders as social and political issues continue to divide the country and tensions spill over into the workplace. Her tips: find support, leverage your professional networks, and share information with your peers. They are likely also engaged in scenario planning and reviewing their employee handbooks to ensure current policies are being followed.   Revisit and Reinforce Your Corporate Values Speaking of employee handbooks, now is the time—not the day before the election—to take a good look at your organization’s values and what employee behaviors are and are not tolerated. “You want to support employees,” said Wiener, “but you also need to be prepared for [how you will respond to] conflict.” Once you review your employee handbook, it’s important to figure out how the company will act if one of those values is violated. “Leadership needs to decide if they have zero tolerance or if they will put an employee on probation, and they need to be consistent.” Get Input From the Legal Department But Don’t OvercorrectShould you involve legal? Yes, says Wiener. “It’s important to be prepared and understand what you can and cannot do.” Scenario planning, she says, is critical. Ask yourself: How will either election outcome affect my products and services (supply chain, tariffs)? What are the risks and mitigants (for any immigrant workers)? How will employees be impacted (job productivity, mental health)? How might you handle immigration issues, or a harassment claim? But don’t go down a legal rabbit hole. Alison Taylor, a clinical professor at New York University’s Stern School of Business and author of Higher Ground: How Business Can Do the Right Thing in a Turbulent World, weighs in with a word of caution:“The main thing I’m seeing out there is that corporations are overreacting to advice from their legal teams, and dialing back on DEI and ESG because they fear legal retaliation under a Trump presidency,” said Taylor. “But they seem to have forgotten how angry the public and employees were over issues like climate change and racism under the last Trump presidency.” She continued: “A laser focus on legal risk is not a good idea. There needs to be broad scenario planning, certainly caution over sustainability commitments, but also care and restraint about overreacting to rhetoric from either side.”Jenny Sucov is a journalist and editor who focuses on health and well-being. She has worked for companies and publishers including Hinge Health, EverydayHealth.com, Canyon Ranch, Real Simple, and Prevention.(Feature photo by Adamkaz/iStock by Getty Images)

Jenny Sucov | September 23, 2024

Is Talent Acquisition Equipped to Go Up Against the Global Labor Shortage?

For all the concern about AI taking over jobs, an equally pressing question has arisen: Who’ll fill the jobs that still call for human workers? A growing, global talent shortage presents a major threat to businesses across all sectors, countries, and continents. Energy companies don’t have enough green-skilled workers, professional services firms can’t find accountants, and manufacturers are struggling to fill roles on the shop floor.Despite the desperate need for workers, talent acquisition teams report being asked to cut costs and do more with less. Human resources may have moved into the C-suite as a strategic contributor, but not everyone in the department has a seat at the decision-making table. According to new research from the Josh Bersin Co., just 32% of talent acquisition leads feel that they’re strategic contributors to the business. Corporate plans change too quickly, they say, if there is a plan at all, and executives treat workforce planning as an afterthought. Right now, Labor Department statistics show overall job growth slowing more than expected, but employers need to take a long-term view. The problem, HR analyst Josh Bersin told From Day One, is that “workforce planning isn’t a very strategic process. It’s a once-a-year budget exercise. And when there’s a bad quarter, the company looks at the workforce and says, ‘Freeze the headcount over here, freeze the headcount over there.’”For some business leaders, hiring and firing are reflexes, not strategies. The cycle is so predictable that a 2023 story in the Harvard Business Review advised employees to assess their job security by checking their company’s quarterly filings. A bad quarter foreshadows layoffs.Companies can no longer afford to run their recruitment departments like e-commerce warehouses, Bersin argues. And unless leaders start taking it seriously, businesses won’t be able to outrun the talent shortage.Updating Antiquated Talent Acquisition ModelsThere are two types of TA departments, said Bersin: Operational and strategic. The former works like a fulfillment center. A requisition is opened, recruiters source candidates, conduct interviews, present options to managers, and complete the hire. “They’re operationally measured and operationally configured. They look at cost-of-hire, they look at channels and sources, they outsource a lot of stuff, and they design around scale,” Bersin said. The strategic TA team works differently. When someone wants to open a req, they ask questions: Who do you want to hire? What skills should they have? How will they contribute to the business? Is there someone internal who can fill the role? Could the responsibilities of this role be automated?HR analyst Josh Bersin (Photo courtesy of Josh Bersin Co.)If a talent acquisition team isn’t strategic, it’s not necessarily their fault, according to Gina Larson, an HR consultant with more than a decade of experience in HR and talent development. “It’s the direction of the business, the remit that they’re given, and the control that they have” that determines how strategic they can be, she said. “Most companies aren’t set up to invest time and energy into developing more diverse and non-traditional hires that would bring the company into the future.”When Bersin’s company surveyed business leaders about their views of TA, 55% of the respondents said they see the function as an integral part of the organization, but it appears they haven’t learned to treat it that way, and they continue to set the wrong expectations. Old habits die hard, it seems.If executives think recruiters are order-takers, then that’s what they’ll be, Larson said. “We all report to someone. Short-term results typically get the rewards. If you’re struggling for a while and you say, ‘Just trust me, we have long-term results coming,’ it’s hard. Everyone has a stakeholder, and I think there is the pressure of short-term results.”Operational teams are a vestige of an outdated philosophy that equates headcount with revenue, one that prioritizes cost-to-hire and time-to-hire above all else, Bersin said. Companies that run operational TA teams are typically ones that put the business–and its workers–at the mercy of market swings. “The financial pressures on companies these days are so quarterly-based,” Bersin said. “I think CEOs and CFOs have to deal with this very short-term mentality in their investor base. A lot of companies over-hire and then lay people off, and then over-hire and lay people off. What I call ‘enduring companies’ don’t think that way. They ignore those signals and think about long-term, sustainable growth.” When Bersin’s company asked TA leaders to identify the biggest barriers to becoming a strategic business partner, 36% said that shifting business priorities is obstacle No. 1.Talent Acquisition and the Future of BusinessIt seems that no industry is safe from the skills shortage. In the energy sector, imperatives to develop next-generation technologies mean companies need workers with green-energy skills, but seven in every eight workers globally have no green skills to speak of, according to research from LinkedIn. In 2023 the World Economic Forum declared the talent shortage “the next energy crisis.”Companies ranging from auto parts retailers to biotech companies blame financial-reporting problems on the lack of accountants, a shortage so severe that industry-regulating bodies are considering cutting certification requirements for the role. Meanwhile, consulting firm Korn Ferry estimates that the media and telecoms industry is on track to “hit a wall” with a shortage of 4.3 million workers by 2030, and manufacturing is forecasted to have 2.1 million empty jobs by then.Korn Ferry projects that, globally, the shortage of skilled workers will result in more than 85 million empty jobs by the end of the decade. Fifty-seven percent of respondents to the Bersin Co. survey said that it’s the skills shortage that will present the biggest challenge to the TA field in the next 12 months. Some companies are thinking strategically, however. Talent intelligence, as it’s situated in HR, is an increasingly influential discipline, Bersin said. That’s typically led by a data-wielding analyst who advises HR on where to look for the best candidates, what cities they live in, and which schools they graduate from, even the companies they work for. Some companies, like Aon, have invested in apprenticeship programs that train unskilled workers into highly skilled ones. PwC is trying to influence college curriculums to create more accountants. Talent acquisition just can’t afford to work on the sidelines, said Kumud Sharma, chief people officer at financial advisory firm Betterment. Her recruiters work cross-functionally, getting to know all parts of the business. Otherwise, how will they show candidates what the company can offer them?Sharma remembers when talent acquisition was its own entity outside of HR–working like a restaurant window. A hiring manager filled out a form requesting one engineer, and recruiting served up one engineer. But that doesn’t work anymore–because we know better, she said. “We’re not thinking of people as widgets anymore. We’re not thinking of people as products. We’re thinking of people as people now.” It’s this change in thinking that has changed the HR profession altogether.“For 30 years or so, we have been saying that people are the assets of the organization. Who’s bringing those assets in? Those assets are coming through talent acquisition,” said Sharma. “How can that not be a strategic function?”Emily McCrary-Ruiz-Esparza is a freelance journalist and From Day One contributing editor who writes about work, the job market, and women’s experiences in the workplace. Her work has appeared in the Economist, the BBC, The Washington Post, Quartz, and Fast Company.(Featured photo by Izusek/iStock by Getty Images)

Emily McCrary-Ruiz-Esparza | August 19, 2024