Before the pandemic, it was common for workers to adapt their lifestyles to the circumstances of their jobs. Fast forward to 2021 where the roles are reversed: workers are seeking companies that are open to working around their lifestyles. This fact alone has inspired a record-breaking 4 million people to resign from their jobs this April — and with more to come.
They Call It the “Great Resignation"
If you are unfamiliar with this term, it comes from Anthony Klotz, an associate professor of management at Texas A&M University. Klotz noted that because of the accumulation of stalled resignations, more workers are considering a career change. He believes this phenomenon is happening due to the increase of remote and hybrid work as a result of the pandemic.
The Breaking Point
Many workers were interested in switching careers long before Covid-19 arrived. The pandemic put the dreams of millions of Americans on hold. Some of the contributing factors for workers wanting to resign before the pandemic included a reduction in benefits, a decline in work-life balance, or a toxic company culture. The motivations behind their reasons for wanting to quit only grew stronger as they watched massive layoffs occur.
Onwards & Upwards: A Time to Get Inspired
Even in the face of difficulty, employees recognized when it was time to level up their opportunities. Workers began to rethink their priorities, whether that was pursuing a dream job or becoming a stay-at-home parent. Meanwhile, others nurtured their skills and interests in hopes that they could incorporate these learnings into their day-to-day life.
A Shift Across Industries
Over the last few months, the words, “I quit” were spoken to one employer after another. “How to resign” became a trending topic across industries like hospitality, tech, healthcare, and especially retail. As Daniel Zhao, a labor economist with Glassdoor said, "We haven't seen anything quite like the situation we have today." With so many workers in pursuit of their next chapter, this has put the job market in a vulnerable position — especially since the roles workers left were never filled.
Here’s an outlook at how resignations affected various industries:
● The most frequent resignations are found among mid-career workers. Employees ages 30-35 (21.5%), 35-40 (19.6%,) and 40-45 (25.1%) experienced a higher increase whereas ages 20-25 experienced a 20.3% decrease.
● The technology, healthcare, and retail industries are seeing the most resignations. The resignation rates increased between March 2020 and March 2021: 4.5% for technology and 3.61% for healthcare. While in April 2021, 650,000 retail workers quit.
● More managers have resigned as a result of the pandemic. In December 2020, the resignation rate for managers was 12% higher than the previous year. More women exited the industry, commonly to take care of their families, while men moved to different roles.
The Recruiting Challenge
While the unemployment numbers continue to rise, companies are experiencing a labor shortage of workers. A recent report studying the Federal Pandemic Unemployment Compensation shows that a 10% increase in unemployment benefits resulted in a 3.6% decrease in job applications. While a 3.6% increase in applications could certainly solve their companies’ dilemma, human resource departments are weighing out the pros and cons of today’s job market. Factors like the commute, cost-of-living adjustments (COLA), and covid safety protocols are all part of the conversation.
Why the “Great Resignation” Matters
As millions of Americans transitioned to working from home last year, they recognized the takeaway of that experience: an increase in their quality of life. Realizing the benefit of this, many workers refuse to settle for less than a hybrid working model. With millions of workers quitting, and still counting, how will companies adapt to meet their needs? Only time will tell what the job market has in store for those looking to hire and be hired.
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