Please Stay: How Companies Answer the 'Great Resignation'
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.
Michael Stahl
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September 12, 2021
