The growing tide of workers leaving their jobs, the so-called the “Great Resignation,” is a major concern for employers throughout the U.S. and is wreaking havoc on the American economy. Initially it was difficult for experts to clearly pinpoint precisely why people were leaving their jobs in droves, but now we have more data and a clearer picture is emerging. The departures now appear to be the result of more people choosing to retire, change careers, or find more favorable work conditions.
Who is Resigning?
One of the most surprising statistics in understanding the Great Resignation relates to employee retirements. A study from Goldman Sachs reports that two-thirds of the resignations over the last several months were due to retirement. Those workers will not return to the workforce, and that may mean an ongoing shortage in several sectors.
Aside from the retirement surge, the measures employers enacted in response to the Coronavirus pandemic – such as working from home – are now prized commodities. Some employers refuse to adjust to this new expectation causing parents to leave work to spend more time with their children. There are also many anecdotal stories of younger employees leaving their jobs, citing lack of pay or respect in the workplace.
The Lasting Effects of the Great Resignation
One of the most surprising effects of the Great Resignation for companies is how the workforce’s bargaining position has changed. Right now, employees are in a highly advantageous negotiating position, which has led to wage increases. But for some workers, a bigger paycheck may not be enough. In an opinion piece for Business Insider, a union activist advocates that workers use this newfound leverage to instigate broader unionization efforts to make sweeping workplace improvements that could significantly increase employers’ operating expenses.
Has the Employer-Employee Dynamic Changed Forever?
There is a natural and historic tension between the interests of workers and those of employers that has remained relatively stable and in a balanced equilibrium for many decades. The Great Resignation represents what may turn out to be a seismic shift in this relationship. To be thoughtfully prepared to respond to new, coming demands by workers, whether from those who are organized under unions or not, employers should revisit and rethink some of their long-standing employment policies. It is not entirely clear how much and for how long this new and evolving kind of workforce will remain as a fact of everyday life, but even in this changing environment, nimble companies will always have a clear advantage. A willingness to consider reasonable demands and to be open to innovative and creative solutions aimed at improving the workplace without sacrificing the company’s “bottom lines” of profitability and longevity can go a long way to easing staffing woes while retaining valuable, cherished employees in the months and years ahead.